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Nasdaq, S&P 500 end sharply higher, fueled by inflation optimism

Published 11/11/2022, 06:27 AM
Updated 11/11/2022, 08:31 PM
© Reuters. FILE PHOTO: Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar

© Reuters. FILE PHOTO: Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar

By Noel Randewich and Sruthi Shankar

(Reuters) - The S&P 500 and Nasdaq ended sharply higher on Friday, extending a rally started the day before after a soft inflation reading raised hopes the Federal Reserve would get less aggressive with U.S. interest rate hikes.

Amazon (NASDAQ:AMZN) jumped 4.3%, with Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) both up more than 1% and contributing to the Nasdaq's gain.

On Thursday, the S&P 500 and the Nasdaq racked up their biggest daily percentage gains in more than 2-1/2 years as annual inflation slipped below 8% for the first time in eight months.

Declines in healthcare stocks limited the Dow Jones Industrial Average's gain, with UnitedHealth Group (NYSE:UNH) down 4.1% for the day.

"What we're really seeing today is simply a follow-through on yesterday. There's a lot of cash sitting on the sidelines that is being put to work," said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.

"Perhaps it signals some type of bottom being put in the market, some type of line drawn in the sand. But even if we put in a bottom, we're a long way away from setting new highs,” Ghriskey said.

Investors see an 81% chance of a 50-basis point rate hike in December and a 19% chance of a 75-basis point hike, according to CME Fedwatch tool.

Adding some nervousness on Wall Street, crypto exchange FTX said it would start U.S. bankruptcy proceedings and that CEO Sam Bankman-Fried resigned due to a liquidity crisis that prompted intervention from regulators around the world.

The S&P 500 climbed 0.93% to end the session at 3,993.05 points.

The Nasdaq gained 1.88% to 11,323.33 points, while Dow Jones Industrial Average rose 0.10% to 33,749.18 points.

Volume on U.S. exchanges was relatively heavy, with 13.5 billion shares traded, compared to an average of 12.0 billion shares over the previous 20 sessions.

Of the 11 S&P 500 sector indexes, six rose, led by energy, up 3.07%, followed by a 2.48% gain in communication services.

The S&P 500 growth index, which includes interest rate-sensitive technology stocks, rose 1.6%, beating the value index's gain of 0.3%.

For the week, the S&P 500 rose 5.9%, the Dow added 4.15% and the Nasdaq jumped 8.1%. It was the S&P 500's biggest weekly gain since June and the Nasdaq's largest weekly gain since March.

Worries about an economic downturn have hammered Wall Street this year. The S&P 500 remains down about 16% year to date, on course for its biggest annual decline since 2008.

U.S.-listed shares of Chinese companies rose, with Alibaba (NYSE:BABA) Group Holding Ltd gaining 1.4% after China eased some of its strict COVID-19 rules.

© Reuters. FILE PHOTO: Raindrops hang on a sign for Wall Street outside the New York Stock Exchange in Manhattan in New York City, New York, U.S., October 26, 2020. REUTERS/Mike Segar

Advancing issues outnumbered falling ones within the S&P 500 by a 1.7-to-one ratio.

The S&P 500 posted 22 new highs and no new lows; the Nasdaq recorded 102 new highs and 110 new lows.

Latest comments

oh, no. Trump to announce his intent to run for the 2024 bid. stock mkt on Monday will fall big because of the announcement plan. the mkt had a fake rally last week, so it has to roll back, the trump announcement plan is the catalyst.
Cpi now Only 7.7% Will continue going drop. Please stop buying car ya.
The Dow was up 41 points. I wouldn't call that sharply higher.
for this article writer it is sharply higher
Actually it was up 32 points
Title says "Nasdaq, S&P 500 end sharply higher", not Dow.
If got more legs and hsmmer, is better n much convincing
100 bps hiking next month looks a sure thing. powell would be mad as he'll now
scam to be continued..
How do you expect people to take you seriously with a name like that
if wall street likes to take risk, sell stocks and buy crptos.
oil price jump means inflation will jump, further fed rate hiking to follow
crypto collapse means stock market collapse to follow.
Rates are still going up.
folks. fed pivot is premature. don't kid yourself, powell would say
Stoked by optimism, not fact. No evidence of a bear market bottom yet.
"No evidence of a bear market bottom" --  That's the case for every bottom
this is beyond stupid core (without food and energy) went down...with food and energy it went up
Another criminal miracle in the BIGGEST INVESTMENT JOKE IN THE WORLD.  "Rallies walk a clothes like, and the intraday volatility and miracle "recoveries" accompany every loss.  Assume the proper position for the weekend America.
"walk a clothes like"?  And yes, the market goes up and down,
a fake rally does not have a leg.
inflation 7.7 pct its not reason to stop Fed interest rate, goal is 2pct inflation!!!!
They ain't considering nor even talking about that.
bets? casino you mean?
consumers feel like they don't have money to buy anthing.. king consumers feel bad. economic depression just around the corner
fed was raising rates to curb down inflation and to bring commodities prices and daily necessities prices down but on just rising bets of fed slowdown the commodities are 20% up..so will fed stop raising rates? if it does no impact of fed will be left and right we will see hyper inflation
"daily necessities" like food and fuel, which is a mess because Russia invaded Ukraine.
'Bets' and 'hopes'...so this is a casino? :D  Real data like Amazons weak earnings and Meta's mass layoffs have no chance in moving markets!
Anyone know why bonds aren't trading today? Verge of collapse?
Vet Day.
On expectation that FED won't hike rates aggressively from here
If you really believe the bear market is over and capitulation is here then you need to invest all available cash NOW.
Nope, it's going to be bloody! The hedgies are gonna push for a bear
Suffering from pain and repeated attacks, is it possible to not take medicine?
yes
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