Stocks rise on Wall Street, remain on track for winning week

NEW YORK (AP) — Shares rose in midday trade on Wall Street on Friday, keeping major indexes on track for weekly gains after several days of up-and-down trading.

The S&P 500 was up 1% at 11:48 am Eastern. The Dow Jones Industrial Average rose 351 points, or 1.2%, to 30,693 and the Nasdaq rose 0.7%.

Technology and healthcare companies have some of the strongest earnings. Oracle was up 4.3% and Pfizer was up 4.2%.

Social media companies were broadly lower after Snapchat’s parent company issued weak guidance and the Washington Post reported that Elon Musk plans to cut about three-quarters of Twitter’s payroll after buying the company. Snap plummeted 30.1% and Twitter lost 4.7%.

The yield on the 10-year government bond, which drives mortgage rates, was steady at 4.24% late Thursday. The yield on the two-year Treasury bond, which tends to line investor expectations for interest rate action by the Federal Reserve, fell to 4.51% from 4.61%.

The markets have been unsettled in recent days. Stocks ranged from strong gains earlier in the week to losses later in the week. The benchmark S&P 500 and other major indices are all still on course for weekly gains in what has been an encouraging October so far.

Investors have shifted their focus to the latest round of corporate earnings for now as they look for more clues as to how hot inflation and rising interest rates are shaping the economy. Reports from airlines, banks, railroad operators and others have so far provided mixed financial results and forecasts.

American Express fell 6.1% after setting aside hundreds of millions of dollars to cover potential losses as the economy continued to deteriorate. Railroad CSX fell 0.7% after reporting solid financial results.

Investors remain concerned about inflation and the Federal Reserve’s attempt to cool hot prices on everything from groceries to clothing by aggressively raising interest rates. Higher interest rates tend to discourage borrowing and investment and slow economic activity. That could plunge economies into recession.

“The concern remains that bond yields will rise and the Fed will not signal a turn,” said Ross Mayfield, investment strategist at Baird Markets.

The latest inflation data from Japan is another reminder that stubbornly high prices remain a global problem. Japan’s main consumer prices rose 3.0% year-on-year in September, according to government data released on Friday. That was the highest increase in eight years.

Central banks around the world have been raising interest rates primarily to fight inflation, and much of the focus has been on the Fed. It has raised its policy rate to a range of 3% to 3.25%. A little over six months ago, that rate was close to zero.

The Fed is expected to hike rates by another three-quarters of a percentage point at its upcoming November meeting. Markets were unsettled in part because investors had hoped that any sign of slowing inflation or slowing economic growth could signal that the Fed was about to ease its rate hikes.

Rate hikes have not yet shown any sign of having a significant impact on inflation, but policy impact is lagging behind. The Wall Street Journal reported that some Fed officials are signaling more caution, suggesting a slowdown in rate hikes soon to see how the fight against inflation goes and to avoid going too far with aggressive rate hikes.

“The risk is that the market will try to price in those pivots before the Fed signals that this is going to happen,” Mayfield said.