Late Downdraft Dents Wall Street's Gains
Updated from 4:15 p.m. EDT
Stocks in the U.S. closed to the upside Wednesday, but selling pressure in the final hour left the major averages well below their best levels of the day.
For most of the session, the indices rallied amid cooler-than-expected inflationary data and results at Freddie Mac (FRE) that weren't nearly as bad as analysts had predicted. However, by the close, the Dow Jones Industrial Average had given up more than half its gains and was ahead by 66.2 points, or 0.52%, to 12,898.38.
The S&P 500 added 5.62 points, or 0.4%, to 1408.66. The Nasdaq Composite, which outperformed for much of the day, in the end barely held onto positive territory as big tech names Google (GOOG), Apple (AAPL) and Amazon.com (AMZN) saw weakness in the last hour of trading. The index edged up 1.58 points, or 0.06%, to 2497.The late fade notwithstanding, Steven Sheldon, CFA and principal with SMS Capital Management, called the day's action a "relief rally" in response to the encouraging consumer price numbers, since trepidation about inflation has been fairly prevalent among investors. The Labor Department said that, despite a 0.9% jump in food costs -- the biggest advance in nearly two decades -- April consumer prices rose only 0.2% from the prior month. Economists had been looking for a 0.3% uptick. The core consumer price index, which excludes food and energy, rose 0.1%, or half of the expected increase. Energy prices, the government said, were unchanged from March. Year over year, core consumer inflation was up 2.3%, a bit lower than anticipated, while the overall CPI climbed 3.9% from a year ago.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV