The Nasdaq took Wall Street’s main indices higher on Tuesday after data showed consumer prices rose largely in line with estimates, putting pressure on high-growth stocks, which are fueled by aggressive US interest. Rate hikes were based on expectations.
The Labor Department report shows consumer prices rose 8.5% in the 12 months through March, slightly higher than the 8.4% projected, although the so-called core CPI fell short of the 6.5% estimate.
“The surprise came in core inflation and provided some relief to markets that are very concerned about inflationary pressures,” said George Catrambon, Head of Trading at DWS Group.
“I think the overall release is in line with the ‘peak inflation is behind us’ narrative, but the bottom line is that inflation remains high, with several 50 bps hikes still on the table.”
At the US Federal Reserve meeting next month, the money market still sees a 93.5% chance of growth of 50 basis points, largely unchanged from earlier figures.
The benchmark US 10-year Treasury yield fell to 2.71% after touching 2.83% earlier in the day, last seen in late 2018.
The return in yields brought relief to megacap growth and technology stocks such as Tesla Inc., Apple Inc. and Amazon.com Inc., which rose between 2.2% and 3.8%.
Still, the Nasdaq is down about 13% this year, the worst performer of the three major indices.
Big US banks are set to start their first-quarter earnings season on Wednesday. Analysts expect them to report a sharp drop in earnings compared to a year ago, when they benefited from exceptionally strong dealmaking, trading and funds set aside for debt losses.
At 10:17 am, the Dow Jones Industrial Average was up 243.93 points, or 0.71%, at 34,552.01, the S&P 500 was up 48.24 points, or 1.09%, at 4,460.77 and the Nasdaq Composite was up 246.96 points, or 1.84. %, at 13,658.91.
The energy sector jumped 2.6%, with 11 major S&P 500 sectors leading percentage gains as crude oil prices rose more than 5% after Shanghai eased some COVID-19 restrictions and OPEC warned that It would be impossible to reverse a potential supply loss from Russia.
Crowdstrike Holdings Inc jumped 8.2%, citing enhanced demand by Goldman Sachs to “buy” shares of the cybersecurity company.
Beyond Meat Inc. grew 3.6% after expanding its meatless chicken tender distribution to 8,000 new retail locations.
The number of advance issues declined to a 5.45-to-1 ratio on the NYSE and a 4.08-to-1 ratio on the Nasdaq.
The S&P index recorded 15 new 52-week highs and one new low, while the Nasdaq recorded 30 new highs and 62 new lows.
This story has been published without modification in text from a wire agency feed.