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Wall Street ended higher on Wednesday, led by a rally in growth stocks. Investors looked past the high inflation data as the corporate earnings season started off on a positive note. The 10-year Treasury yield dropped for the second straight session. All the three major indexes ended in the green.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 1% or 344.23 points to close at 34,564.59. Twenty-seven components of the 30-stock index ended in the green, one remained unchanged, while two closed in the red.
The tech-heavy Nasdaq Composite lost 2% or 272.02 points to finish at 13,643.59, driven by a tech rally.
The S&P 500 climbed 1.1% or 49.14 points to end at 4,446.59. Nine of the 11 broad sectors of the benchmark index closed in the green.
The Consumer Discretionary Select Sector SPDR (XLY), the Technology Select Sector SPDR (XLK) and the Materials Select Sector SPDR (XLB) rose 2.5%, 1.6% and 1.5%, respectively. The Utilities Select Sector SPDR (XLU) dropped 0.2%.
The fear-gauge CBOE Volatility Index (VIX) declined 10.1% to 21.82. A total of 10.5 billion shares were traded on Wednesday, lower than the last 20-session average of 12.3 billion. Advancers outnumbered decliners on the NYSE by a 2.92-to-1 ratio. On Nasdaq, a 2.87-to-1 ratio favored advancing issues.
Markets Upbeat on Q1 Earnings Reports
Wall Street made gains on Wednesday, shrugging off inflation warnings of the historic high Producer Price Index data. The high PPI numbers were attributed to strong demand, and the general notion remained that inflation may have already peaked. Markets were majorly driven by the initial, mostly positive, Q1 corporate earnings numbers released through the day.
Investors closely watched the earnings reports to get the hang of how well companies were managing inflationary pressures. With the overhanging apprehensions about the imminent tightening of the monetary policy already priced in, growth stocks did well, led by semiconductor stocks. Airlines stocks soared on the back of Delta Air Lines, Inc.’s (DAL - Free Report) high Q2 forecast, which indicated that passengers will continue to fly despite higher fares.
On Wednesday, the 10-year Treasury yield dropped 3 basis points to close at 2.7%. This followed the release of the Producer Price Index data, which signaled continued inflation. It had touched 2.82%, its highest level since December 2018, earlier in the week. Falling yields push growth stocks up in general, but they particularly help tech stocks.
Economic Data
The U.S. Bureau of Labor Statistics reported that the Producer Price Index for final demand increased 1.4% in March, seasonally adjusted after advancing 0.9% in February.
On an unadjusted basis, final demand prices increased 11.2% for the 12 months ended March, the highest surge since November 2010.
The core PPI, which excludes food and energy prices, increased 1.1%, which is more than the estimated 0.5% for March. February’s core PPI increase was revised to 0.8%.
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Stock Market News for Apr 14, 2022
Wall Street ended higher on Wednesday, led by a rally in growth stocks. Investors looked past the high inflation data as the corporate earnings season started off on a positive note. The 10-year Treasury yield dropped for the second straight session. All the three major indexes ended in the green.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 1% or 344.23 points to close at 34,564.59. Twenty-seven components of the 30-stock index ended in the green, one remained unchanged, while two closed in the red.
The tech-heavy Nasdaq Composite lost 2% or 272.02 points to finish at 13,643.59, driven by a tech rally.
The S&P 500 climbed 1.1% or 49.14 points to end at 4,446.59. Nine of the 11 broad sectors of the benchmark index closed in the green.
The Consumer Discretionary Select Sector SPDR (XLY), the Technology Select Sector SPDR (XLK) and the Materials Select Sector SPDR (XLB) rose 2.5%, 1.6% and 1.5%, respectively. The Utilities Select Sector SPDR (XLU) dropped 0.2%.
The fear-gauge CBOE Volatility Index (VIX) declined 10.1% to 21.82. A total of 10.5 billion shares were traded on Wednesday, lower than the last 20-session average of 12.3 billion. Advancers outnumbered decliners on the NYSE by a 2.92-to-1 ratio. On Nasdaq, a 2.87-to-1 ratio favored advancing issues.
Markets Upbeat on Q1 Earnings Reports
Wall Street made gains on Wednesday, shrugging off inflation warnings of the historic high Producer Price Index data. The high PPI numbers were attributed to strong demand, and the general notion remained that inflation may have already peaked. Markets were majorly driven by the initial, mostly positive, Q1 corporate earnings numbers released through the day.
Investors closely watched the earnings reports to get the hang of how well companies were managing inflationary pressures. With the overhanging apprehensions about the imminent tightening of the monetary policy already priced in, growth stocks did well, led by semiconductor stocks. Airlines stocks soared on the back of Delta Air Lines, Inc.’s (DAL - Free Report) high Q2 forecast, which indicated that passengers will continue to fly despite higher fares.
As a result, shares of American Airlines Group Inc. (AAL - Free Report) and Advanced Micro Devices, Inc. (AMD - Free Report) gained 10.6%, and 2.8%, respectively. American Airlines carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
10-Year Treasury Yield Continues to Fall
On Wednesday, the 10-year Treasury yield dropped 3 basis points to close at 2.7%. This followed the release of the Producer Price Index data, which signaled continued inflation. It had touched 2.82%, its highest level since December 2018, earlier in the week. Falling yields push growth stocks up in general, but they particularly help tech stocks.
Economic Data
The U.S. Bureau of Labor Statistics reported that the Producer Price Index for final demand increased 1.4% in March, seasonally adjusted after advancing 0.9% in February.
On an unadjusted basis, final demand prices increased 11.2% for the 12 months ended March, the highest surge since November 2010.
The core PPI, which excludes food and energy prices, increased 1.1%, which is more than the estimated 0.5% for March. February’s core PPI increase was revised to 0.8%.