Stocks rise as Wall Street heads for best week since July

<p><p>Stocks were climbing again on Friday, as encouraging reports on the economy and corporate profits help Wall Street firm itself following a shaky few weeks.</p></p><p><p>The S&amp;P 500 was 0.5% higher in midday trading. The Dow Jones Industrial Average was up 269 points, or 0.8%, at 35,182, as of 11:54 a.m. Eastern time, and the Nasdaq composite was 0.3% higher.</p></p><p><p>Leading the way for the S&amp;P 500 was freight deliverer J.B. Hunt Transport Services, which peeled to a 8.7% gain after reporting stronger profits for the summer than Wall Street expected.</p></p><p><p><a href=”https://apnews.com/article/business-a94700ca955005a11e15815d98843b67″ target=”—blank”>Goldman Sachs</a> rose 2.7% and Prologis was up 1.9% on better-than-expected profit reports, while Alcoa surged 14.2% after it beat earnings expectations and announced a dividend payment and buyback of its stock.</p></p><p><p>They dovetailed with a report showing <a href=”https://apnews.com/article/business-lifestyle-prices-retail-sales-fa6ba6b6ce36101caa6b6d133e855c59″ target=”—blank”>people spent much more at U.S. retailers last month</a> than Wall Street expected.</p></p><p><p>Sales at stores, restaurants and other retail establishments rose 0.7% from August instead of falling, as economists forecast.</p></p><p><p>Friday’s gain follows up on a 1.7% jump for the S&amp;P 500 Thursday, its best day since March, which was driven by stronger-than-expected earnings reports and <a href=”https://apnews.com/article/coronavirus-pandemic-business-health-94814d87baa33b872ab0602f63a41b46″ target=”—blank”>encouraging data on the job market</a>.</p></p><p><p>The S&amp;P 500 is on track for a 1.6% gain for the week and its best weekly performance since July.</p></p><p><p>It’s a turnaround from a shaky few weeks, when the S&amp;P 500 fell as much as 5.2% from its record set on Sept. 2.</p></p><p><p>Worries about stubbornly high inflation, reduced support for markets from the Federal Reserve and a slowing economy helped to knock stock prices around. The S&amp;P 500 is back within 1.7% of its all-time high.</p></p><p><p>Earnings reporting season has just begun, but early indicators are encouraging.</p></p><p><p>All but one of the 19 companies in the S&amp;P 500 that reported quarterly results this week topped analysts’ profit forecasts.</p></p><p><p>Such strength is crucial after climbing interest rates heightened worries that stock prices had grown too expensive relative to profits.</p></p><p><p>The stronger-than-expected reports on the economy also help calm chatter about “stagflation,” which is the feared marriage of a stagnating economy and high inflation.</p></p><p><p>Of course, all is not clear yet. A report on Friday showing consumer sentiment was weaker than expected amid inflation worries helped limit the market’s gains.</p></p><p><p>Still, stocks of companies whose profits are most closely tied to the strength of the economy, including retailers, automakers and travel-related businesses, were leading the way higher Friday.</p></p><p><p>Amazon rose 2.2%, Ford Motor added 2.7% and Expedia Group was 3% higher.</p></p><p><p>Other than financial companies, which benefited from the better-than-expected profit reports from several big-name banks, industrial businesses and energy producers were also among the strongest gainers.</p></p><p><p>Treasury yields also rose following the much stronger-than-expected report on retail sales. The yield on the 10-year note climbed to 1.57% from 1.52% late Thursday.</p></p><p><p>Higher Treasury yields in recent weeks have been holding back technology and other high-growth stocks recently.</p></p><p><p>When bonds are paying more in interest, investors aren’t as willing to wait as long a time for big profit growth expectations to come to fruition or to pay as high prices for them.</p></p><p><p>Tech stocks in the S&amp;P 500 rose a modest 0.3% Friday, less than the rest of the market, while the communication-services sector that includes many internet companies slipped 0.3%.</p></p><p><p>Stock markets overseas were also strong. In Europe, Germany’s DAX returned 0.8%, and France’s CAC 40 gained 0.7%. The FTSE 100 in London rose 0.4%.</p></p><p><p>In Asia, Tokyo’s Nikkei 225 added 1.8%, Hong Kong’s Hang Seng climbed 1.5% and Seoul’s Kospi advanced 0.9%.</p></p><p><p>The price of benchmark U.S. oil rose 1.1% to $82.22 per barrel, continuing a powerful run that has sent it up more than 70% this year and fanned worries about high inflation.</p></p><p><p>The global benchmark for crude also climbed 1%, though the price of U.S. natural gas fell 3%.</p></p>