Stocks move higher, erasing weekly loss for the S&P 500

Stocks moved broadly higher Thursday, bringing the S&P 500 index out of the red for the week. Health care and technology companies were among the biggest gainers.

The S&P 500 was up 0.6% as of 1:03 p.m. Eastern. The benchmark index is on track to close above its last all-time high set May 7th. The Dow Jones Industrial Average was up 146 points, or 0.4%, to 34,593, and the Nasdaq Composite rose 0.7%. Bond yields were steady.

The Labor Department said consumer prices jumped 5% in May, the biggest year-over-year increase since 2008. The figure was higher than the 4.6% rise that economists had expected.

While investors have been concerned about inflation for weeks, the May report seemed to reinforce the growing consensus that any increase in inflation will be temporary. A significant portion of the rise in consumer prices was tied to the sale of used cars, for example, which is largely attributed to the fact that many rental car companies are buying vehicles to beef up their fleets as people return to traveling.

“Keep in mind that as we start to make our way back to a full economic recovery, there is pent up demand and supply constraints from raw material and labor shortages,” said Mike Loewengart, a managing director at E-Trade Financial. “This creates the type of inflation that the Fed believes is transitory, meaning it too shall pass. Whether or not they are correct remains to be seen.”

The bond market was steady after the inflation data. The yield of the 10-year U.S. Treasury note slipped to 1.48% from 1.49% late Wednesday.

Organon jumped 8.6% and Biogen gained 4.3% as health care stocks led the market higher. Technology and communication stocks also rose. Microsoft gained 1.5% and Charter Communications added 1.6%. Banks and industrial companies were the only laggards. Wells Fargo slid 1.1%, while...