US stocks rebound as oil prices ease, inflation data steadies market sentiment

Major US stock indexes recovered on Friday as crude oil prices pulled back from their recent surge, helping ease some of the pressure on investor sentiment. Markets also found support after the latest US consumer inflation figures came broadly in line with economists’ expectations.

As of 1:49 p.m. Eastern Time, the S&P 500 climbed 1.1%, the Dow Jones Industrial Average was up 1.1%, and the Nasdaq Composite was 1.2% higher.

At the open, the Dow Jones Industrial Average rose 140.4 points, or 0.27%, to 52,204.46. The S&P 500 rose 45.1 points, or 0.59%, to 7,636.75​, while the Nasdaq Composite rose 207.7 points, or 0.80%, to 26,289.414.

Oil Prices Retreat After Sharp Surge

Oil prices had climbed sharply on Thursday, reaching around $110 a barrel, their highest level since May, amid escalating tensions linked to the ongoing war involving Iran and the US.

The retreat in crude prices on Friday provided some relief to investors, who have been closely monitoring the potential impact of higher energy costs on inflation, corporate earnings and consumer spending.

US Inflation Remains Elevated

The Consumer Price Index (CPI) increased 0.4% in August after edging up 0.1% in July, the Labor Department's Bureau of Labor Statistics said on Friday.

In the 12 months through August, consumer inflation advanced 3.4% after rising by the same margin in July.

The inflation reading reinforced expectations on Wall Street that the Federal Reserve could raise its benchmark interest rate at its policy meeting next week.

Treasury Yields Show Mixed Movement

Expectations of higher interest rates pushed the yield on the two-year US Treasury note slightly higher. The two-year yield rose to 4.57% on Friday from 4.56% on Thursday.

Meanwhile, the benchmark 10-year Treasury yield moved in the opposite direction, falling to 4.92% from 4.95% a day earlier.

The moves reflected continued uncertainty in financial markets over the Fed’s next policy decision and the future path of interest rates.

Key Stock Movers

Among individual stocks, Oracle shares gained 2.6% after the technology company reported quarterly profit and revenue that exceeded analysts’ expectations.

Adobe stock slipped 2.5% after the midpoint of its fourth-quarter revenue forecast fell short of expectations.

ACV Auctions shares rallied 44.4% after online vehicle auctioneer Copart agreed to buy it in a nearly $1.9 billion deal.

Bullion

Gold prices rose on Friday, rebounding from recent losses despite strong US inflation data lifting hopes of a Fed rate hike next week.

By 9:23 a.m. EDT (1323 GMT), spot gold rose 1.6% to $4,385.14 per ounce. US gold futures gained 0.5% to $4,426.90.

Among other metals, spot silver rose 2.1% to $64.86 per ounce. Platinum climbed 1.5% to $1,803.94 and palladium gained 2.9% to $1,318.91.