Do More With Reuters
Partner Services

U.S. STOCKS - Wall Street gains after tame CPI data

Fri Jun 13, 2008 10:44pm IST
 
Email | Print | | Single Page
[-] Text [+]

By Cal Mankowski

NEW YORK (Reuters) - U.S. stocks rose on Friday, helped by a government report that showed underlying price pressures rose moderately in May, easing fears that inflation would force a near-term rise in interest rates.

Despite relentless gains in oil and food prices recently, investors bet the latest inflation statistics would let the Fed keep rates steady, helping the economy recover and improving the outlook for corporate profits.

Shares of Lehman Brothers Holdings Inc rose 10 percent, snapping a five-day losing streak, as investors looked for cheap stocks while some short-sellers unwound their positions.

The Labor Department said the Consumer Price Index rose at its fastest pace in six months in May, with the "headline" measure that includes soaring gasoline prices up 0.6 percent. But core CPI, which excludes volatile energy and food costs, rose 0.2 percent, matching expectations.

"There was a little relief on the CPI," said Craig Hester, president and chief executive of Hester Capital Management, in Austin, Texas. "While the headline number was not particularly good, the core number that the Fed tends to focus on was still stuck at 0.2 percent. People took some solace from that."

Hester said that from a technical perspective, the stock market has been in an "oversold" condition, which helped push prices higher.

The Dow Jones industrial average rose 67.17 points, or 0.55 percent, to 12,208.75. The Standard & Poor's 500 Index gained 9.34 points, or 0.70 percent, to 1,349.21. The Nasdaq Composite Index climbed 34.79 points, or 1.45 percent, to 2,439.14.

A drop of $2.34 in the front-month U.S. crude oil price to $134.40 added to the market's positive tone.  Continued...

Dubai Debt Fears

Villas are seen on the The Palm, Jumeirah, with Atlantis, The Palm, under construction on the breakwater (crescent), May 3, 2008.  REUTERS/Jumana El Heloueh

Banks outside the Gulf played down their exposure to Dubai debt, after fears the emirate could default and even derail world economic recovery prompted a sell-off in global markets.  Full Article | Slideshow 

India Investment Summit 2009
India Investment Summit 2009

Top executives and bankers discuss their own plans and the broader opportunities and challenges for India.  Full Coverage 

Photo
People stroll outside the Taj Mahal hotel ahead of the first anniversary of the militant attacks in Mumbai, November 24, 2009.  REUTERS/Punit Paranjpe
Investors worry about another attack

The risk of militants striking again worries investors who fear that a second attack similar to last year's Mumbai raids could shake the economy.  Full Article | Full Coverage 

Market Update

  • IndiaIndia
  • USUS
  • UKUK
  • Asia
  • Most Actives

road to Copenhagen

BLOGS

Photo
Calculated Move

Reliance aims big with $12 bln bid for LyondellBasell.  Blog 

SHOWCASE

Capital Raising
Capital Raising

Analysis - China banks' rush for billions could trip markets.  Full Article 

 
Photo
Bonus Payout

"Bonus" has become a dirty word on Wall Street.  Full Article 

 
Bubble trouble?
Bubble trouble?

With the BSE Sensex at around 17,000 points, are the Indian equity markets looking at a possible bubble?   Commentary 

 
Funding Blues
Funding Blues

A popular tactic used by Indian brokerages to raise money for rich clients is likely to be banned.  Full Article 

 
Recovery Path
Recovery Path

Indian techie logging out of downturn gloom.  Full Article 

 
Central Banks Cautious
Central Banks Cautious

Reuters tracks the policies of the world's top central banks as the debate over global economic recovery rages on.   Full Coverage 

 
Risky Proposal
Risky Proposal

Rupert Murdoch courts trouble if he blocks Google on news.  Full Article