Stocks climb as investors shake off inflation worries
Feb 14, 2018 2:19PM (GMT 19:19) - 968 words
By MARLEY JAY , AP Markets Writer
Eds: Updates with closing metals prices. With AP Photos.
NEW YORK (AP) — U.S. stocks are shaking off an early decline and rising today as banks climb along with bond yields.
The increase in rates came after the government said consumer prices climbed in January at a rate that was faster than economists had expected. There were few signs of the worries about inflation that sent stocks falling in the last few weeks, as technology, industrial and consumer-focused companies also rose.
After tumbling 10 percent in nine days, stocks are now higher for the fourth day in a row. They're up more than 4 percent in that time.
The Standard & Poor's 500 index rose 31 points, or 1.2 percent, to 2,694 as of 2:10 p.m. Eastern time. The Dow Jones industrial average added 178 points, or 0.8 percent, to 24,829. The Nasdaq composite climbed 113 points, or 1.6 percent, to 7,127. The Russell 2000 index of smaller-company stocks rose 23 points, or 1.6 percent, to 1,518.
Excluding volatile items like food and energy, prices paid by consumers rose 0.3 percent in January. That's the most in a year.
Stocks started slumping Feb. 1 after reports of greater wage growth caused investors to worry about faster inflation. Inflation has been very low for years, and if that changes, it could prompt the Federal Reserve to raise interest rates more rapidly. Higher interest rates act as a check on the economy by making it more expensive for businesses and individuals to borrow money.
The reaction to the gains in consumer prices was relatively calm today. The yield on the 10-year Treasury note rose to 2.90 percent, its highest mark in four years, from 2.84 percent the day before.