A rally Thursday on Wall Street lifted stocks to their highest level in almost two months, per the AP, following the latest sign that inflation is cooling.
- The S&P 500 rose 54.27 points, or 1.3%, to 4,146.22.
- The Dow Jones Industrial Average rose 383.19 points, or 1.1%, to 34,029.69.
- The Nasdaq composite rose 236.93 points, or 2% to 12,166.27.
Thursday's report showed that prices paid to producers last month were 2.7% higher than a year earlier, the lowest inflation level there in more than two years. The hope on Wall Street is that easier inflation on the wholesale level will not only support profits for companies but also flow through to cooler inflation for consumers. A day earlier, a separate report said inflation for consumers slowed to 5%.
Inflation and how high the Federal Reserve will hike interest rates to tame it have been at the center of Wall Street's struggles for more than a year. The Fed has raised rates at such a feverish pace that it's already slowed parts of the economy and caused strains to appear in the banking system. A separate report Thursday said slightly more workers applied for unemployment benefits last week than expected, though the job market has remained resilient. A softening job market could take more pressure off inflation. That plus the inflation report underscored traders' expectations that the end is near for the Fed's rate hikes.
Apple climbed 3.4%, and Amazon jumped 4.7%, and the pair were two of the biggest forces lifting the S&P 500. Delta Air Lines slid 1.1% after flipping between gains and losses through the morning. It reported weaker results for the latest quarter than expected, but it also said customers still want to fly despite all the economy's challenges. It predicted a bigger-than-expected profit for the second quarter.
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