Stocks power higher after a terrible week; Dow jumps 410

What inflation? Apple and Facebook drive Wall Street rally

What inflation? Apple and Facebook drive Wall Street rally

But those concerns were tempered by data showing United States retail sales fell 0.3% last month, the biggest decline in almost a year. Yum added 0.1 per cent. In early trading Wednesday, investors were mixed. The Russell 2000 index of smaller-company stocks rose 13.15 points, or 0.9 percent, to 1,490.98. The S&P 500 closed at 2,698.63 for a gain of 35.69 points or 1.34%.

The monthly Labor Department report on the price of everything from gas to groceries was closely watched Wednesday, with Wall Street investors suddenly very concerned about inflation.

The S&P 500 was up 17 points at 2,679 while the Dow Jones average was 50 points higher at 24,691.

"It does play into the fears that we are getting into a different inflation regime than we were before".

United States stocks managed to shake off inflation data as consumer prices increased more than expected. The move higher took place despite an interest-rates rise to multi-year highs that originally spooked investors.

Retail sales reported a monthly decrease of -0.3%.

"Inflation rates have held steady at 2.1% for annual headline consumer price inflation and 1.8% for the core rate (which excludes food and energy) rather than fall to 1.9% and 1.7%, respectively as the consensus had predicted".

"Given the strength of our brand portfolio, we continue to build momentum in both unit and pipeline growth and now have the largest number of rooms under construction in the industry". Many analysts had believed that the economy might expand at a solid 3 percent pace in the current quarter, largely because they foresaw strong and sustained spending by Americans. The Nasdaq composite advanced 0.7 percent.

But the weakness was not confined to the auto sector.

Retailers traded higher despite the tepid numbers in the report. S&P mini futures sprang 0.4 percent on Thursday.

Benchmark US 10-year Treasury note yields hit a four-year high, but a key measure of near-term volatility fell, in contrast to its reaction to strong US jobs and wages data earlier in the month.

Sales at gasoline service stations rose 1.6 percent, but thats partly due to rising pump prices. The CPI year-on-year increase was untouched at 2.1 percent. Cardinal Health lost 3.4 percent. That was a significant improvement from modest annual growth rates of around 2 percent the USA experienced during the economic recovery, now in its ninth year.

The data raised the specter of rising inflation and rekindled fears that the Federal Reserve could be forced to be more aggressive with interest rate increases.

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