Wall Street Stocks Extend Gains On Weaker Inflation Hopes

Barry Adams
12 Sep, 2022
New York City

Stocks advanced on Wall Street on the hopes that the consumer inflation has peaked and economic slowdown may be not as deep as earlier estimated. 

Investors are awaiting the inflation report on Tuesday and retail sales and industrial production data on Thursday, last two major economic reports ahead of the rate setting committee's meeting later in the month. 

The S&P 500 index increased 1.1% to 4,112.77 and the Nasdaq Composite added 1.2% to 12,259.92. 

With earnings season nearly coming to an end, investors are focused on the possible earnings revisions for the third quarter. 

Energy prices rose after the dollar index declined following the largest rate hike in two decades in the eurozone. 

Crude oil futures increased $1.61 to $88.40 a barrel and natural gas added 25 cents to $8.25 a thermal unit. 

The yield on 12-year Treasury notes declined to 3.54%, 10-year notes edged down to 3.29%, and 30-year bond fell to 3.44%. 

 

European Markets Pull Ahead, Euro Gains 

European markets advanced after investors looked beyond the deepening energy crisis and the hawkish tone of policymakers. 

Resource stocks gained after the dollar weakness lifted the euro and energy prices. 

The euro resumed its advance after the European Central Bank lifted its key lending rate by 75 basis points last week. 

The DAX index jumped 2.5% to 13,419.60, the CAC-40 index 2.1% to 6,342.43, and the FTSE 100 index jumped 1.7% to 7,474.24. 

The euro inched higher to a 3-week high to $1.01 and the British pound edged up to $1.17. 

The British economy expanded 0.2% in July from June after falling 0.6% in the previous month, the Office for National Statistics said Monday. 

Service sector led the expansion with a growth of 0.4% offset by the 0.3% decline in production and 0.8% decline in construction. 

Monthly GDP is 1.1% above its pre-coronavirus level in February 2020. 

GDP was flat in the three months to July compared with the previous three months.

Industrial production in Italy gained 0.4% in July from the downwardly revised 2% decline in the previous month, National Institute of Statistics said Monday. 

On a seasonally adjusted and annual basis, production increased 1.4% after falling 1.1% in June.