Equities have been added to the recent rise in Friday afternoon trading as Wall Street weighs a combination of new data with the company’s earnings report, which shows that inflation has skyrocketed the most in the last 40 years.
The S & P 500 was up 1.3% at 2:18 pm in the east, while the Nasdaq was up 1.6%. Both indices have been moving at a pace until the end of July, the largest increase since November 2020. The Dow Jones Industrial Average rose 0.8%.
Positive earnings news from Apple and Amazon, as well as oil giants Exxon and Chevron, helped inspire traders.
This month’s rise in stock prices was supported by higher-than-expected corporate earnings reports and lower bond yields, which were lowered this year after a significant rise from expectations of rising interest rates.
Weak economic data, including Thursday’s report showing that the US economy could shrink in the previous quarter and fall into recession, is also confident that the Federal Reserve can dial back its aggressive rate hike faster. Pushed up stock prices by giving some investors more than expected.
The central bank raised major short-term interest rates by 0.75 percentage points on Wednesday, the highest level since 2018. The federal government is slowing the US economy and raising interest rates to quell the highest inflation in 40 years.
Inflation gauges, closely tracked by the Federal Reserve, surged 6.8% in June from a year ago, the biggest rise in 40 years, and Americans weren’t free from soaring prices. On a monthly basis, inflation accelerated from a monthly rise of 0.6% in May to 1% in June, according to the Commerce Department.
The numbers emphasized the sustainability of inflation, which is declining American purchasing power, diminishing confidence in the economy and threatening parliamentary democrats for the November midterm elections.
However, some market watchers have advised not to overemphasize the June data.
Jeffrey Roach, Chief Economist at LPL Financial, said: “From now on, food and energy costs in July should go down, so inflation in July will ease a bit from the previous month.”
Still, inflation hit one company with Friday earnings: the giant Procter & Gamble, the staple food of consumers. The market share of tide laundry detergent makers fell 5.3% after the company said it was declining by consumers, but the company’s recent price increases remain profitable.
Revenue reports from other companies have been more encouraging.
Exxon and Chevron posted record quarterly profits in the previous quarter as oil and gas prices soared. Both companies earned $ 46 billion in the previous quarter, about four times more than in the year-ago quarter. Chevron shares rose 8.5% to a six-week high and Exxon rose 4.4%.
Amazon surged 12.1% after recording a quarterly loss, but its revenue surged during the quarter.
Apple grew 3.4% after quarterly revenues exceeded Wall Street’s expectations. iPhone makers tackled manufacturing headaches and inflationary pressures, with revenues up 2% while profits fell 10% in the April-June period.
In the bond market, yields were mixed. The two-year Treasury yield, which tends to move in line with Federal Reserve expectations, rose from 2.87% late Thursday to 2.89%. The 10-year yield, which affects mortgage rates, fell from 2.67% to 2.64%.
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The US market continues to rise in the face of more severe inflation news. Associated Press
Source link The US market continues to rise in the face of more severe inflation news. Associated Press