Stocks closed broadly higher on Wall Street Wednesday, putting the market further into the green for the week after a solid gain a day earlier. Technology and communications stocks were among the biggest gainers. Microsoft rose 2.2% and Google's parent company, Alphabet, rose 1.6%. Chipmaker Nvidia rose 6.4%. The yield on the 10-year Treasury note held steady at 1.95%, the highest it’s been since before the pandemic began. The S&P 500 rose 65.64 points, or 1.5%, to 4,587.18. The Dow Jones Industrial Average rose 305.28 points, or 0.9%, to 35,768.06. The Nasdaq rose 295.92 points, or 2.1%, to 14,490.37.
Investors are busy reviewing the latest corporate earnings as they try to determine how different industries are dealing with persistent supply chain problems. That is one of the factors pushing inflation higher and making operations more costly for companies while making products more expensive for consumers. Chipotle Mexican Grill jumped 10.1% after beating analyst’s fourth-quarter earnings and revenue forecasts. The company raised menu prices 4% in December as it faced higher costs for beef and labor. "Overall, companies have found that increasing prices have been more acceptable to their customers than in the past," says Scott Wren, senior global market strategist at Wells Fargo Investment Institute.
Drugstore chain CVS fell 5.5% for the biggest decline in the S&P 500 after giving investors a discouraging earnings forecast. Wall Street will get another update Thursday on rising prices when the Labor Department releases its report on inflation for January. Economists are forecasting the report to show inflation rose to a four-decade high of 7.3%. An unexpectedly smaller rise in prices could be seen as a signal that inflation might be easing and could support markets, though a bigger increase could weigh on stocks. "People are trying to get in position to where they want to be before this number is released tomorrow," Wren says.
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