NEW YORK (AP) — Stocks rose broadly in morning trading on Wall Street Thursday as investors cheered a strong set of quarterly results from Macy’s and other retailers.
The S&P 500 rose 1.3% as of 10:11 a.m. Eastern and is solidly in the green for the week following a choppy few days of trading.
The Dow Jones Industrial Average rose 404 points, or 1.3%, to 32,528 and the Nasdaq rose 1.5%. Smaller company stocks also made strong gains, a sign of bullishness on the economy. The Russell 2000 index rose 1.7%.
Bond yields held steady. The yield on the 10-year Treasury remained at 2.74% from late Wednesday.
Retailers led the broader market higher. Macy’s surged 12.6% after it raised its profit forecast for the year following a strong first-quarter financial report. Dollar General surged 12.1% and Dollar Tree jumped 18.7% after the discount retailers reported solid earnings and gave investors encouraging forecasts.
The retail sector is being closely watched by investors looking for more details on just how much pain inflation is inflicting on companies and consumers. Weak reports from the several big names last week, including Target and Walmart, spooked an already volatile market.
The latest reports from retailers have helped lift and keep the major indexes in the green for the week and could break a slump. The benchmark S&P 500 is coming off of seven straight weekly losses.
Technology stocks also did much of the heavy lifting. TurboTax maker Intuit jumped 6%. Companies in the sector, with their lofty stock values, tend to push the market harder up or down.
The broad gains on Thursday follow a late push for markets on Wednesday prompted by details from the Federal Reserve’s latest meeting, which confirmed expectations of more interest rate hikes.
Investors have been uneasy over the impact of interest rate hikes in the United States and other Western economies that are meant to cool surging inflation. The key concern is whether the Fed can temper inflation with aggressive interest rate hikes without crimping economic growth to the point that the U.S. falls into a recession.
Inflation is at a four-decade high and businesses have been raising costs on everything from food to clothing to offset higher costs. The impact from Russia’s invasion of Ukraine worsened inflation pressures by fueling higher energy and key food commodity costs. Supply chain problems worsened in the wake of China’s lockdown for several major cities as it tried to contain COVID-19 cases.
U.S. crude oil prices rose 2.6% and are up roughly 50% for the year.
Consumers have been resilient about spending, but the pressure from inflation remains persistent and could be prompting a pullback or shift in spending from big discretionary items to necessities.
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