WASHINGTON (dpa-AFX) - Stocks recovered from an early move to the downside to move modestly higher over the course of the trading session on Thursday. With the turnaround, the major averages largely offset the pullback seen during Wednesday's session, with the Dow and the S&P 500 rebounding to three-month closing highs.
The S&P 500 ended the day up 23.02 points or 0.4 percent at 6,045.26, the Dow climbed 101.85 points or 0.2 percent to 42,967.62 and the Nasdaq rose 46.61 points or 0.2 percent to 19,662.48.
The turnaround on Wall Street came as traders digested the latest U.S. inflation data, with a report from the Labor Department showing producer prices crept up by less than expected in the month of May.
The Labor Department said its producer price index for final demand inched up by 0.1 percent after slipping by a revised 0.2 percent in April.
Economists had expected producer prices to rise by 0.3 percent compared to the 0.4 percent decline originally reported for the previous month.
Meanwhile, the report said the annual rate of growth by producer prices accelerated to 2.6 percent in May from 2.5 percent in April, in line with economist estimates.
'For the second day in a row, inflation data came in lower than expected and this gives the Fed room to sit on their hands,' said Chris Zaccarelli, Chief Investment Officer for Northlight Asset Management.
He added, 'As long as inflation isn't increasing - or even better, is decreasing - the Fed can be patient and wait for more information on how the new tariffs and trade negotiations are going to impact the price stability part of their dual mandate later this year.'
Stocks moved lower earlier in the day due in part to lingering uncertainty about trade amid a lack of details about the U.S.-China trade deal announced on Wednesday.
President Donald Trump told reporters he would send letters to other U.S. trade partners in about two weeks outlining new tariff rates.
Trump also indicated he would be willing to extend the 90-day pause on tariffs set to expire early next month but said he doesn't think it will be necessary.
Sector News
Gold stocks showed a strong move to the upside amid a sharp increase by the price of the precious metal, with the NYSE Arca Gold Bugs Index climbing by 1.5 percent.
Significant strength also emerged among interest rate-sensitive utilities stocks, as reflected by the 1.4 percent gain posted by the Dow Jones Utility Average.
Software, pharmaceutical and networking stocks also moved notably higher on the day, while airline stocks extended Wednesday's slump.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan's Nikkei 225 Index slid by 0.7 percent, while South Korea's Kospi climbed by 0.5 percent.
The major European markets also ended the day mixed. While the U.K.'s FTSE 100 Index rose by 0.2 percent, the French CAC 40 Index edged down by 0.1 percent and the German DAX Index fell by 0.7 percent.
In the bond market, treasuries extended the notable upward move seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, declined 5.5 basis points to a one-month closing low of 4.357 percent.
Looking Ahead
Trading on Friday may be impacted by reaction to preliminary readings on consumer sentiment and inflation expectations in the month of June.
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