Wall Street Reaches Fresh Highs Ahead Of Earnings

Growth names have found their footing over the past two weeks after being outperformed by value stocks for most of the year. A pullback in the ten-year US Treasury yield from a 14-month high hit in late March encouraged buying in growth.

Data showed US producer prices increased more than expected in March, bringing the largest annual gain in almost ten years.

Many investors now expect higher inflation as vaccine rollouts help the U.S. economy rebound from lockdowns, yet stocks showed little concern as the Federal Reserve has maintained it will allow inflation to overshoot its target.

"This is why all week long (Powell) was jawboning, he made sure everyone understood they were expecting a spike and they are ready for it, it wasn’t a surprise," said Ken Polcari, managing partner at Kace Capital Advisors in Jupiter, Florida.

"Which is why the market is not backing off, because he succeeded in jawboning the anxiety and stopped people from getting really panicked about it."

The Dow Jones Industrial Average rose 0.89 percent, to 33,801, the S&P 500 gained 0.77 percent, to 4,129 and the Nasdaq Composite added 0.51 percent, to 13,900.

For the week, the S&P rose 2.71 percent, the Dow advanced 1.96 percent and the Nasdaq climbed 3.12 percent.

The banks kick off first-quarter earnings season next week with Goldman Sachs, JPMorgan and wells Fargo scheduled to report on Wednesday.

Megacap names such as Apple, Amazon and Microsoft, which are in the growth index, advanced to pace the S&P 500. Amazon shares rose 2.21 percent as warehouse workers in Alabama rejected an attempt to form a union. (Reuters)