U.S. stocks gave up an early rally Thursday afternoon after hitting a three-month high in the morning session following another batch of July data that suggested inflation may be easing.
- The Dow closed up +27.16 or +0.08%
- The S&P 500 closed down -2.97 or -0.07%
- The Nasdaq shed -74.89 or -0.58%
Stocks surged to their highest levels since early May after the July producer-price index fell 0.5%, compared with expectations for a 0.2% rise, although the three main U.S. stock benchmarks have pared their gains somewhat heading into afternoon trading in New York with big technology stocks lagging.
Thursday’s optimistic inflation report followed a similarly cooler-than-expected reading on U.S. consumer-price growth released a day earlier. That data also helped send stocks soaring, with the Nasdaq exiting bear-market territory and the Dow exiting correction territory.
Hopes that inflation has peaked helped encourage investors to pile back into equities based on the view that slowing inflation could allow the Federal Reserve to hike interest rates less aggressively.
However, some market analysts are urging caution as rising housing costs could keep core inflation elevated, even as a drop in oil prices and other commodities has helped to reduce inflation expectations……..[read more]
*Click on the “Full Loaf” icon to read the full article! After you read the full article, come back and tell us your thoughts.