Stocks rise after three days of losses, Bitcoin drops 11%
Stocks were posting strong gains in early trading Thursday, following three days of losses and the biggest one-day drop in the S&P 500 since February.
Technology stocks, which were hurt hard earlier in the week, were among the bigger gainers in early trading. Apple, Microsoft, Facebook and Amazon were all up 1% or more.
The S&P 500 Index was up 1.2% as of 10:05 a.m. Eastern. The Dow Jones Industrial Average was up 1.2% as well while the tech-heavy Nasdaq Composite was up 1.5%. It’s not uncommon for markets to reverse direction after sharp gains or losses over a period of days as investors reassess markets and pause during period of volatility.
But investors have had things to be concerned about. Last week’s jobs report was showed fewer employers hiring than had been expected, and on Thursday the government reported that wholesale prices jumped 0.6% last month, driven by higher costs for services and food. That was more than expected and the latest indication that inflation pressures are mounting.
Rising prices reflect growing economic activity after last year’s global shutdown to fight the coronavirus pandemic. However investors worry inflation might disrupt the recovery or prompt central banks to withdraw stimulus and near-zero interest rates.
Bond yields rose sharply this week in response to the data but pulled back slightly on Thursday. The yield on the 10-year Treasury note was 1.68% compared to 1.70% the day before.
In other markets, the price for Bitcoin plunged 11% after billionaire Elon Musk changed his position on the digital currency, citing the environmental impact. He said Tesla Motors would no longer accept Bitcoin as payment for its cars.
Crude oil prices fell more than 2% after a key gasoline pipeline on the East Coast was reopened late Wednesday. The price of crude oil is now down slightly for the week.