Stocks open higher following Wall St slump, as investors update rate bets
Investing.com -- U.S. stocks climbed in early trading on Wednesday, marking a small rebound from a sell-off on Wall Street in the prior session, as investors recalibrated their interest rate bets in the wake of a stronger-than-anticipated U.S. inflation reading.
By 09:38 ET (14:38 GMT), the benchmark S&P 500 had risen by 0.4%, the tech-heavy Nasdaq Composite had added 0.6%, and the blue-chip Dow Jones Industrial Average had inched up by 0.1%.
On Tuesday, the main indices in New York all tumbled after data showed that overall U.S. consumer price gains were faster than economists had predicted in January, pointing to a lingering stickiness in inflationary pressures that further dashed hopes for an imminent interest rate cut by the Federal Reserve.
Analysts at ING said the release was «uncomfortable reading» for the Fed. The U.S. central bank has made defeating price growth one of the main targets of an aggressive tightening campaign, but inflation remains stubbornly above its stated 2% target. Markets have all but erased their previous bets for a 25 basis point reduction at the Fed's March policy meeting and lowered the chances of one in May.
In individual stocks on Wednesday, Lyft (NASDAQ:LYFT) shares soared by more than 30% even after paring back a large chunk of their premarket gains due to a significant error in its margin outlook. Chief Financial Officer Erin Brewer revealed that the company had mistakenly announced an excessively high annual margin growth forecast. Brewer said that the margin projection for 2024 was actually for a more modest increase of 50 basis points, contrary to the previously stated expansion of 500 basis points. But investors retained some positivity around the ride-sharing firm after it said
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