Updated from 8:06 a.m. EDTStocks in the U.S. were climbing at the open Wednesday amid cooler-than-expected inflationary data and improved results at
Freddie Mac (FRE).
The
Dow Jones Industrial Average was rising 42 points to 12,875, and the
S&P 500 was adding 6 points to 1409. The
Nasdaq Composite was tacking on 7 points to 2502.
Stock index futures had been signaling a decline prior to the opening bell, but reversed course after the Labor Department said that, despite a 0.9% jump in food costs -- the biggest advance in nearly two decades -- April consumer prices rose only 0.2% from the prior month. The core consumer price index, which excludes food and energy, ticked up 0.1%, half of the expected increase. The overall number was estimated to have risen 0.3%.
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Year over year, core consumer inflation was up 2.3%, a hair lower than anticipated, while the overall CPI climbed 3.9% from a year ago. Energy prices, the government said, were unchanged from March.
On the equities side, among the early winners was government-sponsored mortgage buyer Freddie Mac, which said its first-quarter loss narrowed to $151 million, or 66 cents a share, from the prior quarter's loss of $3.97 a share. The stock rose 7.3%.
However, chipmaking-equipment seller
Applied Materials (AMAT) slipped 2.2% after reporting dwindling earnings. Revenue nonetheless topped analyst expectations. In a conference call, CEO Mike Splinter predicted more softness in chip-related spending, but predicted that "this is the bottom."
Electronic Arts (ERTS), a video-game publisher, offered a weaker full-year profit outlook than that targeted by Wall Street. The company also
came in well ahead of expectations for the fiscal fourth quarter with adjusted earnings of $30 million, or 9 cents a share, on 50% higher sales. Still, shares lost 0.7%.
Away from the tech patch,
Whole Foods (WFMI) plunged 10.9% after the organic-foods mart said costs from its Wild Oats buyout ate into its fiscal second-quarter profit, which slid 13%, even as revenue soared by 27.6%. Same-store sales, or those from locations open a year or more, climbed 6.7%.
Late in the trading day Tuesday,
Clear Channel Communications (CCU) reached a
buyout settlement with Thomas H. Lee Partners and Bain Capital worth $36 a share, or $17.9 billion. That's $3.20 a share lower than what the companies had previously agreed on, but shares closed the last session higher and added 1.1% in the new session.
Among commodities, crude oil was sinking 59 cents to $125.21 a barrel, and gold futures gave up $6.40 to $863.20 an ounce. The U.S. dollar gained 0.2% against the euro to $1.544, while firming by 0.3% against the yen at 105.11.
Treasury prices were falling. The 10-year note was down 7/32 in price to yield 3.94% and the 30-year bond lost 3/32 in price, yielding 4.66%.
Markets abroad were mixed. In Asia, Hong Kong's Hang Seng Index slipped 0.1% overnight, but the Nikkei 225 in Tokyo climbed 1.2%. As for Europe, London's FTSE 100 shed 0.2%, and Germany's Xetra Dax gave up 0.4%. The Paris Cac rose 0.1%.
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