Wall Street had an auspicious start to December on Thursday, with stocks soaring as investors welcomed inflation-friendly economic data...
NEW YORK — Wall Street had an auspicious start to December on Thursday, with stocks soaring as investors welcomed inflation-friendly economic data and hoped the November rally would continue through year-end. The Dow Jones industrials climbed 106 points.
The Dow rose 106.70 to 10,912.57. The rise nearly reversed the market’s previous three days of losses.
Microsoft, one of the 30 Dow stocks, gained 21 cents to close at $27.89 a share. Boeing, also a Dow stock, soared $1.48 to $69.67.
Broader stock indicators also rose sharply. The Standard & Poor’s 500 index added 15.19 to 1,264.67, and the Nasdaq composite index surged 34.35 to 2,267.17.
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Investors were heartened by the Commerce Department’s report that consumer prices rose just 0.1 percent in October, far better than September’s 0.9 percent jump. With incomes rising 0.4 percent and spending rising 0.2 percent, the market felt consumers could be well-positioned for a strong holiday shopping season, while lower prices could bring an end to the Federal Reserve’s interest-rate increases.
The news was enough to overcome some mixed retail-sales reports. It also brought newfound confidence to investors, who piled into small-cap, riskier stocks as enthusiasm grew over a possible halt to interest-rate increases.
“Investors have their rally caps on for year end, and we’re doing it with speculation,” said Jack Ablin, chief investment officer at Harris Private Bank. “With a good inflation report and strong growth, it seems to be the perfect elixir for Wall Street.”
Crude-oil prices were volatile, with a barrel of light crude oil settling at $58.47, up $1.15, on the New York Mercantile Exchange.
An improvement in the labor picture ahead of today’s monthly job-creation report also lent support to stocks. First-time jobless claims fell to 320,000 last week, down from 335,000 the week before, the Labor Department said.
The day’s other economic indicators were mixed. The manufacturing sector grew at a slower pace in November than in October, according to data from the Institute of Supply Management. Construction spending for October exceeded expectations, the Commerce Department said.
But inflation and the Fed remain chiefly in mind for investors, analysts said.
“What happens over the remainder of the year will depend on investors’ perceptions of the Fed,” said Joseph Keating, chief investment officer at First American Asset Management. “If it looks like inflation is in check and the economy isn’t growing too fast, then we’re in for a good run.”