Stocks surged following positive retail sales and producer price index (PPI) data. The stock market experienced a significant increase amidst the optimistic news. Retail sales showed a jump of 0.6% in June, surpassing expectations and pointing to an economic recovery. Additionally, PPI data indicated that wholesale inflation remained under control. This combination of positive indicators led to a surge in stocks, boosting market confidence..
Wall Street stocks popped on Thursday, as investors weighed hotter-than-expected retail sales and wholesale price inflation data for a steer on what path the Federal Reserve will take on rates policy.
The S&P 500 (^GSPC) gained 0.7%, while the Dow Jones Industrial Average (^DJI) ticked up 0.9%, or about 300 points. The Nasdaq Composite (^IXIC) added around 0.8%, as British chipmaker Arm (ARM) popped more than 12% in the moments after it started trading on the exchange.
Despite much anticipation, markets were little moved Wednesday by an uptick in the August consumer inflation report. That wouldn’t be enough to prompt the Fed to change course, economists said.
Thursday’s reading on retail sales for the same month came in stronger than they were in July, underscoring how the US consumer has remained resilient despite rising interest rates. Sales grew 0.6% on the month, compared with 0.1% expected, picking up steam as people shelled out more for gas.
The Producer Price Index increased 0.7% in August, up from 0.4% the previous month, data out Thursday showed — a sign that inflation remains stubbornly persistent despite the Fed’s efforts to cool pressures. But at the same time, “core” wholesale inflation rose 2.2%, down from July’s print of 2.4%.
Arm’s debut on the Nasdaq on Thursday comes after the SoftBank-backed chip designer priced its blockbuster IPO at the top of the range at $51 per share for a $54.5 billion valuation. The stock quickly rose above $57 per share in the first 15 minutes of trading.
Also in focus was the ongoing rally in oil prices, given their significant effect on inflation and on stocks. WTI crude (CL=F) and Brent (BZ=F) futures were trading near 10-month highs on Thursday.
Elsewhere, the European Central Bank hiked its interest rates for the 10th time in a row, to 4% — the highest level since the euro was launched in 1999. ECB policymakers also upped their inflation forecast, which they expect to remain too high for too long.
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Wall Street stocks rose on Thursday as investors analyzed the latest retail sales and wholesale price inflation data to gauge the Federal Reserve’s future interest rate policy. The S&P 500 and Dow Jones Industrial Average both gained, while the Nasdaq Composite saw a slight increase. Retail sales for August exceeded expectations, indicating that the US consumer remains resilient despite rising interest rates. Additionally, the Producer Price Index showed persistent inflation, although core wholesale inflation dropped slightly from the previous month. In other news, chipmaker Arm debuted on the Nasdaq, and oil prices continued to rally. The European Central Bank also raised interest rates and increased their inflation forecast.
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