30.6 C
Brunei
Friday, August 12, 2022
30.6 C
Brunei
Friday, August 12, 2022
More
    - Advertisement -
    - Advertisement -

    Wall Street breaks 7-week losing streak, longest since 2001

    NEW YORK (AP) – Technology companies led a broad rally for stocks on Friday as Wall Street notched its best week in 18 months. The gain broke a seven-week losing streak for the market, the longest such stretch since 2001.

    The S&P 500 rose 2.5 per cent and finished 6.6 per cent higher for the week, its best weekly gain since November 2020. The Dow Jones Industrial Average rose 1.8 per cent and the tech-heavy Nasdaq gained 3.3 per cent.

    The strong finish for the week came as investors received potentially encouraging news about inflation. The Commerce Department said that inflation rose 6.3 per cent in April from a year earlier, the first slowdown since November 2020 and a sign that high prices may finally be moderating, at least for now.

    The report was released as Wall Street looks for any signal that inflation could be easing, while trying to figure out just how low stocks might sink.

    “At this point that’s all the market needs,” said investment strategy analyst at Baird Ross Mayfield. “It’s definitely one of the signs you would want to see.”

    The S&P 500 ended 100.40 points higher at 4,158.24. The Nasdaq rose 390.48 points to 12,131.13. It was the third straight gain for both indexes. The Dow rose 575.77 points to 33,212.96, its sixth-straight gain.

    Smaller company stocks also gained ground. The Russell 2000 rose 49.66 points, or 2.7 per cent, to 1,887.90.

    A trade specialist works at his post. PHOTO: AP

    The broader market has been in a slump for nearly two months as concerns about inflation and rising interest rates pile up. Investors were spooked last week by disappointing reports from key retailers, including Walmart and Target, which stoked fears about rising inflation hitting profit margins and crimping consumer spending.

    Trading remained choppy throughout the week, though the market mostly pushed higher, as retailers including Macy’s and Dollar General released encouraging earnings reports and financial updates.

    Retailers were among the biggest gainers on Friday as investors continued reviewing the latest round of earnings to get a better sense of just how much pain rising inflation is inflicting on businesses and consumers. Beauty products company Ulta Beauty surged 12.5 per cent for the biggest gain in the S&P 500 after raising its profit forecast for the year. Amazon rose 3.7 per cent.

    Disappointing financial updates and earnings weighed on several companies. Clothing retailer American Eagle fell 6.6 per cent after reported weak first-quarter earnings.

    Inflation is at a four-decade high and has been persistently squeezing businesses. Higher costs prompted companies to raise prices on everything from food to clothing to protect their margins and consumers remained resilient. Russia’s invasion of Ukraine worsened the inflation picture by pushing global energy and food prices even higher.

    US crude oil prices were relatively stable, but are up nearly 60 per cent in 2022. Wheat prices are up about 50 per cent and corn prices are up 30 per cent this year.

    Supply chain problems at the heart of rising inflation were worsened in the wake of China’s lockdown for several major cities.

    The extra inflation squeeze has made it even more difficult for businesses to offset costs and is seemingly prompting a shift in consumer spending away from expensive items and toward necessities. It has also raised concerns that the Federal Reserve may have an even more difficult time trying to temper the impact from inflation.

    - Advertisement -
    spot_img

    Latest article

    - Advertisement -
    spot_img