Stocks stagger higher after mixed report on April inflation
NEW YORK (AP) — Stocks are stumbling mostly higher on Wall Street Wednesday after inflation slowed last month but still came in worse than feared.
The S&P 500 was 0.4% higher after waffling between gains and losses in early trading. The Dow Jones Industrial Average was up 315 points, or 1%, at 32,480, as of 11:49 a.m. Eastern time, and the Nasdaq composite was 0.5% lower as tech stocks again lagged the market.
Wall Street has been transfixed on the nation's high inflation, and where it's heading, because it's causing the Federal Reserve to yank the supports it propped under markets for most of the pandemic. The Fed has flipped aggressively toward raising interest rates after seeing high inflation last longer than it expected.
Wednesday’s report from the U.S. Labor Department showed inflation slowed a touch in April, down to 8.3% from 8.5% in March. Investors also found some glass-half-full signals in the data that inflation may be peaking and set to ease further.
Nevertheless, the numbers were still higher than economists forecast. They also showed a bigger increase than expected in prices outside food and gasoline, something economists call “core inflation” and which can be more predictive of future trends.
“Core inflation came in hot, and that’s what really matters to the Fed at this point,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments.
Economists said the inflation report will keep the Fed on track for rapid and potentially sharp increases in interest rates in upcoming months, though the data led to erratic trading on Wall Street.
Treasury yields initially jumped but pared their gains as the morning progressed. As the yields regressed, most stocks reversed their early losses.
The 10-year Treasury yield climbed as high as...