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US STOCKS-Wall Street rises on inflation data but geopolitical tensions cut gains

Reuters · 11/15/2022 14:57
US STOCKS-Wall Street rises on inflation data but geopolitical tensions cut gains

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U.S. producer prices rise less than expected

Walmart jumps on strong forecast, other retailers rise

Indexes up: Dow 0.03%, S&P 0.74%, Nasdaq 1.4%

Updates with mid-afternoon trading

By Lewis Krauskopf, Amruta Khandekar and Ankika Biswas

- The S&P 500 and Nasdaq were higher on Tuesday, but gains were cut after a report that Russian missiles crossed into Poland and killed two people, somewhat undermining hopes that cooling inflation would lead to a pullback in rate hikes by the U.S. Federal Reserve.

Two people were killed in an explosion in Przewodow, a village in eastern Poland the border with Ukraine, firefighters told Reuters.

The Associated Press cited a senior U.S. intelligence official as saying the blast was due to Russian missiles crossing into Poland. However, the Pentagon said on Tuesday it could confirm reports that Russian missiles had crossed into Poland.

Russia has been pounding cities across Ukraine with missiles, in attacks that Kyiv said were the heaviest wave of missile strikes in months of war, while Poland's prime minister called an urgent meeting of a government committee for security and defense affairs.

"The decline was triggered by reports of a Russian missile landing in Poland," said Steve Sosnick, chief strategist at Interactive Brokers. "This could develop into something far worse, but right markets are , panicked."

Stocks pulled back around mid-day, after jumping higher earlier in the session after data showed U.S. producer prices increased less than expected.

“You still are seeing volatile trading across markets,” said Matthew Miskin, co-chief investment strategist at John Hancock Investment Management.

"We are out of the woods yet as it relates to the Russia-Ukraine war. We did get incrementally better data on inflation but there are also still growth concerns.”

The Dow Jones Industrial Average .DJI rose 9.73 points, or 0.03%, to 33,546.43, the S&P 500 .SPX gained 29.4 points, or 0.74%, to 3,986.65 and the Nasdaq Composite .IXIC added 156.76 points, or 1.4%, to 11,352.98.

Tuesday's inflation report showed producer prices rising 8% in the 12 months through October against an estimated 8.3% rise.

Tuesday's equity gains built on a rally kicked off late last week by a cooler-than-expected report on consumer prices.

Shares of Walmart Inc WMT.N jumped 7% after the top U.S. retailer lifted its annual sales and profit forecasts, benefiting from a steady demand for groceries despite higher prices.

Shares of other retailers, including Target Corp TGT.N and Costco COST.O, also rose following Walmart's report.

(Reporting by Lewis Krauskopf and Carolina Mandl in New York, Shubham Batra, Sruthi Shankar, Amruta Khandekar and Ankika Biswas; Additional reporting by Devik Jain;
Editing by Shounak Dasgupta and Arun Koyyur)

((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters Messaging: lewis.krauskopf.thomsonreuters.com@reuters., Twitter: @LKrauskopf))