By Sruthi Shankar and Aparajita Saxena
(Reuters) - Wall Street's pull back from the recent sell-off was set to continue on Thursday as investors went bargain-hunting for the fifth day in a row, brushing aside fears of rising inflation.
Leading the early gainers was Cisco, whose shares jumped nearly 8 percent in premarket trading after the network gear maker posted upbeat results and forecast.
"We're looking at a pretty good opening here, maybe a little bit of continuation from yesterday's gains. But the ability of the markets to spit out bad news in terms of the higher inflation, weaker sales is a pretty strong sign," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
"A lot of investors are looking for opportunities or pull backs to put money to work - there's still a lot of cash out there looking for something to do, so I think we're back to 'buy the dips' mentality here."
A Labor Department report showed U.S. producer prices rose 0.4 percent in January, but only matched economists' estimates and likely calming fears that inflation was picking up faster than expected.
The reports followed a strong January consumer prices data on Wednesday that raised jitters of rising inflation and faster interest rate hikes, a repeat of the fears sparked by a strong U.S. jobs report on Feb. 2 that triggered last week's sell-off.
But after an initial dip on Wednesday, investors snapped up shares of Facebook, Amazon.com, Apple and other such stocks to keep Wall Street in rally mode for a fourth straight session.
Since last Thursday, the S&P 500 has surged 4.56 percent, its strongest four-session performance since mid-2016. But, the index remains down about 6 percent from its record high on Jan. 26.
Benchmark 10-year U.S. Treasury yields hit a new four-year high of 2.9241 percent on strengthening expectations of a rate hike in March. But while yields have been on the uptick since the CPI data, they have not come at the cost of stocks.
A further boost to markets came from a continued fall in a key measure of near-term volatility. The CBOE Volatility index ended lower on Wednesday and fell below 18 on Thursday, well off the 50-point peak touched last week.
Also underpinning many investors' confidence is the view that the U.S. economy remains on strong footing as well as the expected boost of tax cuts on corporate profits.
TripAdvisor gained about 16 percent after the company reported better-than-expected quarterly revenue.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)