Stocks Rally as Oil Price Tumbles Again

Stocks closed higher on Wall Street Tuesday as inflation worries ebbed and oil prices slid. The S&P 500 gained 2.1% after a report showed inflation’s rapid acceleration paused at the wholesale level last month, the AP reports. Oil tumbled more than 6%. Treasury yields were mixed as the Federal Reserve began its highly anticipated two-day meeting on rates. The S&P 500 rose 89.34 points to 4,262.45. The Dow Jones Industrial Average rose 599.10 points, 1.8%, to 33,544.34. The Nasdaq rose 367.40 points, or 2.9%, to 12,948.62. The Russell 2000 index of smaller companies rose 27.25 points, or 1.4%, to 1,968.97

The wilder action was in oil and Asian stock markets, where tightened anti-COVID measures in China are raising worries about demand for energy and about disruptions to manufacturing and global trade. Oil prices tumbled more than 6%, taking some pressure off the world's high inflation, and a barrel of US crude fell below $97 after starting the week above $109. Stocks in Hong Kong sank more than 5% for a second straight day after the neighboring city of Shenzhen was ordered into a shutdown.

A reprieve on fuel prices helped a wide variety of stocks, and the majority of companies in the S&P 500 rose. Airlines led the way after several raised their forecasts for revenue this quarter. American Airlines, Delta Air Lines, and United Airlines all soared 8% or more. In other developments, the London Metal Exchange said trading in nickel will resume Wednesday, just over a week after it was suspended when the price of the metal skyrocketed to over $100,000 per ton. Russia is the world’s No. 3 producer of nickel. Its price and that of many other commodities has surged on speculation over possible disruptions to supplies as Russia contends with widening economic sanctions.