Stocks rose on Wednesday as investors at least temporarily set aside concerns over rising inflation.
Each of the S&P 500, Dow and Nasdaq opened higher on Wednesday, reversing course after a choppy session a day earlier ultimately ended with the major indexes in the red.
Investors this week have continued to contemplate prospects that higher inflation during the post-pandemic recovery will ultimately curb the extent of the rebound in economic activity and rally in stock prices. New data Tuesday showed consumer confidence dipped in April even as more social distancing standards were lifted, with the decline coming in part as consumers took note of rising price pressures.
“I do think we’ve been in this consolidation phase, really since early April. That’s when we started a new phase in this market cycle, the first one [was] that recovery in stay-at-home stocks from March to November last year, the second phase was the reopening phase from November to March,” Gabriela Santos, global market strategist at JPMorgan Asset Management, told Yahoo Finance. “Now we’re moving beyond the recovery and focusing on the expansion up ahead. And we haven’t had a lot of new data on this recently, so it makes sense to see stocks consolidate.”