U.S. stocks moved higher Thursday after hot inflation data and surging bond yields sparked a sell-off in technology stocks Wednesday.
The S&P 500 ticked up 0.2%. The tech-heavy Nasdaq Composite gained 0.7%. The Dow Jones Industrial Average shed about 73 points, weighed down by Disney‘s 8% drop.
Tech names rallied Thursday after October’s consumer price reading pushed up bond yields Wednesday. The spike in rates pressured growth pockets of the equity market.
Nvidia rallied about 2% and AMD added more than 1%. Big Tech stocks like Facebook-parent Meta and Google-parent Alphabet both rose.
On the downside, Disney shares fell more than 8% after the media giant missed on the top and bottom lines of its quarterly results. Disney+ subscribers also came in short of estimates.
The bond market is closed Thursday for Veterans Day.
Wednesday’s inflation report showed the consumer price index, which tracks a basket of products ranging from gasoline and health care to groceries and rents, rose 6.2% in October from a year ago, hitting its highest level in three decades.
“Inflation remains stubbornly high, to the surprise of many that expected prices to come back to earth sooner,” said Ryan Detrick, chief market strategist for LPL Financial. “The truth is you can’t shut down a $20 trillion economy and not feel some bumps as it restarts, but we are hopeful the supply chain issues will resolve over the coming quarters and inflation should calm down as well.”
Following the CPI data, traders moved up their expectations for when the first Fed rate hike would occur. The Fed funds futures market now sees greater odds of the central bank’s first full rate hike coming in July 2022.
