NEW YORK, May 15 — Wall Street closed higher in a broad rally, an upbeat conclusion to whipsaw week of buying and selling as signs of a rebounding economy squared off against mounting inflation jitters.
All three major US indexes extended yesterday’s gains, which saw S&P 500 notch its biggest one-day percentage bump in over a month.
“Today ‘everything is going up day’ because everyone is buying,” said Chuck Carlson, senior vice president at Wealthspire Advisors, in New York. “It’s a ‘buy everything’ day.”
Still, the indexes suffered their biggest weekly declines since late February.
“This week, given the big swings, is more evident of a trader’s environment than a long-term investor’s environment,” Carlson added. “It’s a market looking for its next sustained impulse to the upside.”
Those big swings were stoked by economic data, which fanned concerns that near-term price spikes could translate into long-term inflation, despite assurances to the contrary from the US Federal Reserve.
“Inflation continues to be the biggest concern,” Carlson added. “And when interest rates didn’t go to new highs the bulls take over and investors are willing to step in and buy some of the stocks that had been beaten up this week.”
Economic data showed retail sales growth stalling and consumer sentiment dipping as prices remain on an upward trajectory, suggesting that while the demand boom might be taking a breather, inflation has not.
But in an indication that economic activity could return to normal, revised guidance from the US Centres for Disease Control and Prevention said fully vaccinated people no longer need to wear masks outdoors and can avoid wearing them indoors in most places.
The Dow Jones Industrial Average rose 360.68 points, or 1.06 per cent, to 34,382.13, the S&P 500 gained 61.35 points, or 1.49 per cent, to 4,173.85 and the Nasdaq Composite added 304.99 points, or 2.32 per cent, to 13,429.98.
All 11 major S&P sectors ended the session green, with energy, boosted by rebounding crudes prices, enjoying the largest percentage gain, rising 3.2 per cent.
Chips gave a lift to the technology sector , extending gains in the wake of a Reuters report that lawmakers in Washington are close to unveiling a US$52 billion (RM214.5 billion) dollar proposal to aid US microchip production.
The Philadelphia SE Semiconductor index jumped 3.0 per cent.
First-quarter earnings season is nearing its final curtain, with 457 constituents of the S&P 500 having posted results. Of those, 87 per cent have beaten consensus estimates, according to Refinitiv IBES.
Analysts now see annual S&P earnings growth of 50.6 per cent, in aggregate, for the Jan-March period, more than triple the rate forecast at the beginning of the quarter, per Refinitiv.
Major retailers Walmart, Home Depot, Target , Lowe’s and others are on the docket next week.
Walt Disney Co shares were driven down 2.6 per cent after subscriber additions to its streaming service fell short of expectations.
Airbnb Inc reported a 52 per cent jump in bookings as vaccinations boosted vacation rental demand, driving its stock up 4.0 per cent.
Advancing issues outnumbered declining ones on the NYSE by a 4.63-to-1 ratio; on Nasdaq, a 4.58-to-1 ratio favoured advancers.
The S&P 500 posted 30 new 52-week highs and no new lows; the Nasdaq Composite recorded 92 new highs and 59 new lows.
Volume on US exchanges was 9.50 billion shares, compared with the 10.50 billion average over the last 20 trading days. — Reuters
