Wall Street Rebounds: Dow Surges 1.2% as Inflation Data Offers Positive Signals

The U.S. stock market experienced a significant recovery, with the Dow Jones Industrial Average surging 498.02 points (1.2%), the Nasdaq Composite and S&P 500 also showed strong gains, jumping 1% and 1.1%.

The Dow surged 498.02 points (1.2%) to 42,840.26, adding to the slim gain posted in Thursday's session when the blue chip index snapped a ten-day losing streak. The tech-heavy Nasdaq also jumped 199.83 points (1%) to 19,572.60 and the S&P 500 shot up 63.77 points (1.1%) to 5,930.85.

The Commerce Department said its personal consumption expenditures (PCE) price index inched up by 0.1% in November after rising by 0.2% in October. The annual rate of growth by the PCE price index accelerated to 2.4% in November from 2.3% in October. Excluding food and energy prices, the core PCE price index also edged up by 0.1% in November after climbing by 0.3% in October.

 

Banking stocks significantly moved upwards with the KBW Bank Index jumping by 2%. Commercial real estate stocks displayed considerable strength, as reflected by the 1.8% by the Dow Jones U.S. Real Estate Index. Utilities stocks also regained ground, driving the Dow Jones Utility Average up by 1.5%. Gold, brokerage and semiconductor stocks also saw notable strength on the day, moving higher along with most of the other major sectors.

Asia-Pacific stocks moved mostly lower on Friday. China's Shanghai Composite Index edged down by 0.1% and Japan's Nikkei 225 Index dipped by 0.3% while Australia's S&P/ASX 200 Index slumped by 1.2%. European stocks ended the day modestly lower. While the German DAX Index fell by 0.4%, the French CAC 40 Index and the U.K.'s FTSE 100 Index both slipped by 0.3%.

In the bond market, treasuries regained ground after moving sharply lower over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price fell 4.6 bps to 4.52%.

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