Stocks traded higher Friday as investors looked beyond a hotter-than-expected report on inflation.
The S&P 500 gained 0.2% after reaching a record high on Thursday. Both the Dow and Nasdaq also advanced. The 10-year yield dipped back below 1.5%.
The Bureau of Labor Statistics reported on Thursday that its headline consumer price index rose by 5.0%, or by the most since 2008, in May. Core consumer prices, which exclude volatile food and energy prices, surged at the fastest rate since the 1990s, extending gains after an already strong April report.
U.S. stocks reacted less negatively to the report than they had in April, however, with the S&P 500 jumping to a new record high.
“The inflation outlook has rightfully been top of mind since last month’s blowout report,” LPL Financial Chief Market Strategist Ryan Detrick said in a note Thursday. “Under the hood, though, we think the picture is a bit more sanguine than the headlines would suggest, and still believe inflation will be relatively well-contained over the intermediate-to-long term.”