Wall Street’s main indexes moved higher on Thursday as investors parsed the latest producer prices data, while the prospect of Russia-Ukraine peace talks spurred some risk-taking.
The producer price index for final demand rose 0.4% last month after an upwardly revised 0.5% gain in December, the Labor Department’s Bureau of Labor Statistics said.
Economists polled by Reuters had forecast the PPI rising 0.3%. In the 12 months through January, the PPI advanced 3.5% after increasing 3.3% in December.
“The revisions indicated higher inflation in the past, which make today’s unexpectedly high inflation number look small in comparison,” said Kim Forrest, chief investment officer at Bokeh Capital Partners.
Yields across government bonds also turned lower after the data, with the yield on the 10-year note last at 4.55%.
Wall St falls as inflation data hints at slower rate cuts
Before the report, traders of futures contracts that settle to the federal funds rate placed close to a 60% chance that the U.S. Federal Reserve would still be on hold in July, although that chance fell to about 52% after the data.
Separately, the number of Americans filing new applications for unemployment benefits decreased last week, suggesting the labor market remained stable early in February.
A January consumer price index reading on Wednesday showed the highest increase in prices in nearly a year-and-a-half, underscoring the Fed’s messaging that it was in no rush to resume cutting interest rates anytime soon.
The last reading of the personal consumption expenditures price index, the Fed’s preferred inflation gauge, showed the fastest rise in months. Persistent signs of rising inflation could mean the central bank’s policymakers will be cautious about cutting rates at all this year.
Meanwhile, Trump said Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy had expressed a desire for peace in separate phone conversations with him on Wednesday.
He also posted on his social media platform that he would detail the latest in a barrage of tariffs on imports to the U.S. he has unveiled since taking office last month in a press conference at 1 p.m. (1800 GMT).
At 9:54 a.m. ET, the Dow Jones Industrial Average rose 35.89 points, or 0.08%, to 44,404.45, the S&P 500 gained 10.08 points, or 0.16%, to 6,061.80 and the Nasdaq Composite gained 73.49 points, or 0.37%, to 19,723.45.
Seven of the 11 S&P 500 sectors traded higher, with consumer discretionary and materials being the top gainers.
Megacaps were mixed, although Tesla and Nvidia outperformed with a rise of 3.2% and 1.3%.
Trade Desk dropped 31.4% after the ad tech firm forecast its first-quarter revenue below analysts’ estimates.
Cisco Systems added 2.4% after the network-equipment maker raised its annual revenue forecast, while Robinhood Markets jumped 11.9% as the trading platform beat fourth-quarter profit expectations.
Deere fell 3.3% after the world’s largest farm-equipment maker’s quarterly revenue slumped 35% and missed analysts’ expectations.
Advancing issues outnumbered decliners by a 2.56-to-1 ratio on the NYSE and by a 1.61-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and seven new lows, while the Nasdaq Composite recorded 63 new highs and 38 new lows.
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