Stocks rise on Wall Street; report shows strong retail sales
FILE – Pedestrians pass the New York Stock Exchange, May 5, 2022, in the Manhattan borough of New York. Stocks are opening modestly lower on Wall Street Monday, May 16, 2022 continuing a losing streak that has brought the market down for six weeks in a row. The S&P 500 was down 0.6% in the early going, while more declines in technology companies pulled the Nasdaq down 1.1%. The Dow Jones Industrial Average fell 0.3%. Spirit Airlines rose 7% after JetBlue said it would make a hostile offer for the budget carrier after Spirit rebuffed its earlier bid. (AP Photo/John Minchillo, File)
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NEW YORK (AP) — Stocks are opening higher on Wall Street Tuesday, led by a rebound in the highly volatile technology sector.
The S&P 500 index rose 1.3% and the tech-heavy Nasdaq rose 2%. The Dow Jones Industrial Average was up 0.9%. Apple rose 1.8% and Microsoft added 2.3%.
The highly volatile technology sector led the gains. Apple rose 1.5% and Microsoft rose 1.2%. Pricey stock values for many big technology companies give the sector more weight in pushing the broader market up and down.
The gains were broad and included retailers, health care companies and industrial firms. Amazon rose 1.2%. Abbott Laboratories rose 4.2% after the company made a deal with regulators to ramp up production of baby formula amid a shortage.
Banks gained ground along with rising bond yields, which they rely on to charge more lucrative interest on loans. The yield on the 10-year Treasury rose to 2.95% from 2.88% late Monday. JPMorgan Chase rose 3.2%.
The solid gains on Tuesday come as the broader market struggles to break a six-week slump.
The Commerce Department said U.S. retail sales rose 0.9% in April. The solid increase was driven by higher sales of cars, electronics and more spending at restaurants. The upbeat report helps allay some concerns on Wall Street about persistently high inflation crimping consumer spending.
Inflation is at a four-decade high, driven by demand for goods outpacing supplies in the aftermath of the pandemic. Supply chain problems have prompted businesses to raise prices on everything from food to clothing. Rising energy prices following Russia’s invasion of Ukraine worsened pressure from inflation, as did China’s strict lockdown measures over the last month as it faces a resurgence of COVID-19 cases in major cities.
Walmart, the nation’s largest retailer, fell 8.7% after reporting disappointing earnings and trimming its profit forecast for the year, partly because of inflation pressures.
Central banks have been shifting policies to help fight inflation. The Federal Reserve is gradually pushing its benchmark short-term interest rate off its record low near zero, where it spent most of the pandemic. Investors are concerned that the central bank could cause a recession if it raises rates too high or too quickly and are watching for comments by Fed officials that might provide insight into the U.S. economic outlook and future policy moves.
