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US STOCKS-Wall Street gains on inflation data, but rocky on geopolitics

Reuters · 11/15/2022 16:40
US STOCKS-Wall Street gains on inflation data, but rocky on geopolitics

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U.S. producer prices rise less than expected

Walmart jumps on strong forecast, other retailers rise

Indexes up: Dow 0.17%, S&P 0.87%, Nasdaq 1.45%

Updates with further market details

By Lewis Krauskopf, Amruta Khandekar and Ankika Biswas

- Wall Street's main indexes gained on Tuesday, shaking off an unconfirmed report of Russian missiles crossing into Poland that sparked volatility, as investors seized on softer-than-expected inflation data that raised hopes of a pullback in rate hikes by the U.S. Federal Reserve.

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

The gains built on a rally that was kicked off late last week by a cooler-than-expected report on consumer prices.

"The market has been driven by the inflation that came out a little bit lower than expected and confirmed last week's to some degree that we may have rounded the corner on inflation," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

The market was "a little bit more volatile this afternoon as stories came out about the Russian missile landing in Poland," Tuz said.

The Dow Jones Industrial Average .DJI rose 56.22 points, or 0.17%, to 33,592.92, the S&P 500 .SPX gained 34.48 points, or 0.87%, to 3,991.73 and the Nasdaq Composite .IXIC added 162.19 points, or 1.45%, to 11,358.41.

Two people were killed in an explosion in Przewodow, a village in eastern Poland the border with Ukraine, firefighters said as NATO allies investigated reports that the blast resulted from Russian missiles.

The Associated Press earlier cited a senior U.S. intelligence official as saying the blast was due to Russian missiles crossing into Poland. But the Pentagon said it could confirm that account.

Stocks pulled back around mid-day after the report, with the Dow turning , before they steadied.

"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."

Shares of Walmart Inc WMT.N jumped 6.5% 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. Target, which is due to report on Wednesday, rose 3.9%, while Costco gained 3.3%.

Home Depot HD.N shares rose 1.6% after the home improvement chain's results showed it tapped higher prices to override a drop in customer transactions for the third quarter.

Advancing issues outnumbered declining ones on the NYSE by a 3.25-to-1 ratio; on Nasdaq, a 2.01-to-1 ratio favored advancers.

The S&P 500 posted 5 52-week highs and lows; the Nasdaq Composite recorded 85 highs and 76 lows.

About 13.1 billion shares changed hands in U.S. exchanges, compared with the 12.2 billion daily average over the last 20 sessions.

(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))