U.S. stocks resumed gains early Friday after a rally fueled by lighter-than-expected inflation data this week hit a lull in the previous trading session.
The S&P 500 advanced 0.5%, with the benchmark index on pace for a fourth straight up week. The Dow Jones Industrial Average added 130 points, or roughly 0.4%, and the technology-heavy Nasdaq Composite climbed 0.8%.
Electric-vehicle maker Rivian Automotive (RIVN) was on watch after the company on Thursday reported a wider-than-expected loss for the second quarter but maintained its production outlook for the rest of the year. Shares fell more than 2% at the start of trading.
Apple (AAPL) shares ticked up following a Bloomberg News report that indicated the tech giant expects to sustain iPhone sales in 2022 despite a market slowdown. The company projects it will assemble roughly 220 million iPhones in total this year, per Bloomberg, which cited people familiar with the matter. Apple’s sales and production expectations are typically a closely-guarded secret.
Economic data in recent days has reassured investors that inflationary pressures are beginning to cool across the economy after climbing at a steady pace since early 2021. The producer price index (PPI) on Thursday showed prices fell 0.5% from the prior month compared to expectations of a 0.2% increase. On Wednesday, the consumer price index (CPI) showed prices stayed flat over the month and rose a less-than-expected 8.5% annually.
On the heels of lighter prints for consumer and producer prices, a reading on U.S. import prices out Friday reflected their first decline in seven months in July, according to data from the Labor Department. Import prices fell by a better-than-expected 1.4% last month after rising 0.3% in June, the largest monthly drop since April 2020.
“The fact we’re starting to see energy prices come down, that might be a sign of what is more to come for other inflation indicators,” iCapital Network Chief Investment Strategist Anastasia Amoroso told Yahoo Finance Live. “We’re starting to chip away at this inflation issue, and that’s a big catalyst for the markets.”
CPI data on Wednesday showed the gasoline index fell 7.7% month-over-month in July – the largest drop since April 2020 – as gas prices fall over the past 59 days to dip below $4 a gallon for the first time since March on Thursday, data from AAA showed.
Investors have more data on the docket Friday, with the University of Michigan’s consumer sentiment survey set for release at 10:00 a.m. ET.
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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