Wall Street rebounded strongly Wednesday as the recovering financial sector and continued drop in oil prices eased some of the increasing inflation worries.
Crude oil prices retreated for a second day, giving the stocks a big boost. Light, sweet crude for August delivery fell 4.14 U.S. dollars to settle at 134.60 dollars a barrel on the New York Mercantile Exchange after tumbling 6.44 dollars on Tuesday.
Wells Fargo & Co. offered investors some reason for optimism about the troubled banking sector. The U.S. fifth-largest bank posted its second-quarter earnings fell 22 percent, but still beating Wall Street expectations. And the company decided to raise its dividend by 10 percent, which pleased investors.
The stocks ended mostly lower on worries about the weak financials and the Dow closed below 11,000, the first time since July 2006.
The U.S. Labor Department reported Wednesday that consumer prices jumped 1.1 percent in June, much worse than estimates. The reading shot up last month at the fastest pace in 26 years due to soaring energy prices. The core reading, which excludes food and energy costs, ticked up 0.3 percent.
In corporate news, Target Corp. climbed as the two-day retreat in crude prices overshadowed a government report showing a bigger-than-expected gain in consumer prices.
The Dow Jones rallied 276.74 to 11,239.28, the biggest jump in more than three months. Broader indexes also jumped. The Standard & Poor's 500 index rose 30.45 to 1,245.36; and the Nasdaq advanced 69.14 to 2,284.85.
Source: Xinhua
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