Wall Street surges on news of cooling US inflation

Wall Street surges on news of cooling US inflation

US stocks closed up sharply on Tuesday on the news that US inflation cooled by more than expected last month, fueling hopes of an end to interest rate hikes.

The US Federal Reserve voted last month to hold rates steady at a 22-year high for the second consecutive meeting as policymakers look to bring down inflation while avoiding a damaging recession.

Consumer inflation in the United States increased by 3.2 percent in the 12 months to October, down from 3.7 percent a month earlier, according to the Labor Department.

So-called "core inflation" -- stripping out volatile food and energy prices -- also slowed to an annual rate of 4.0 percent.

The below-target core and headline inflation figures fueled hopes that the Fed is done hiking interest rates, which is often good news for stock markets.

The Dow Jones Industrial Average jumped 1.4 percent to finish the day at 34,827.70, while the broad-based S&P 500 Index jumped 1.9 percent to 4,495.70.

And the tech-rich Nasdaq Composite Index surged 2.4 percent to 14,094.38.

"The market has essentially removed any probability for any more rates hikes," Steve Sosnick from Interactive Brokers told AFP.

"It's hard to find anything that is not joining the party," he added.

Among individual stocks, Home Depot closed up 5.4 percent, while Solaredge was up 10.8 percent.