NEW YORK (AP) 鈥� Stocks are leaping after a report on U.S. inflation sent waves of relief through Wall Street. The S&P 500 was 1.4% higher in early trading Tuesday and near its best level in two months. The Dow rose 375 points, and the Nasdaq composite rose 1.8%. The highly anticipated report showed overall inflation slowed last month, bolstering bets among traders that the Federal Reserve is finally done with its market-crunching hikes to interest rates. Technology and other high-growth stocks led the way higher. Advanced Micro Devices rose 3.3%. The yield on the 10-year Treasury fell sharply, to 4.48%.
THIS IS A BREAKING NEWS UPDATE. AP鈥檚 earlier story follows below.
Wall Street bounced higher Tuesday after better than expected news .
Futures for the Dow Jones industrials rose 1.1% and the S&P 500 edged 1.4% higher.
President Joe Biden will meet with Chinese leader Xi Jinping this week on the sidelines of a in California. It will be the first face-to-face encounter in a year between the leaders of the world鈥檚 two biggest economies.
In corporate news, Home Depot shares got a small bounce after the home improvement chain but narrowed its full-year outlook. Its shares rose less than 1% before the bell. The Atlanta retailer said consumers are reticent to purchase big-ticket appliances, often bought on credit, which has grown very expensive as a result of the fight by the U.S. Federal Reserve to rein in inflation.
Target, Macy's and bellwether Walmart report later this week.
Inflation in the United States slowed last month in a sign that the Federal Reserve鈥檚 interest rate hikes are continuing to cool the that have bedeviled consumers for the past two years.
A report Tuesday from the Labor Department showed that lower gas prices helped cool overall inflation, which was unchanged from September to October, down from the 0.4% jump the previous month. Compared with a year ago, consumer prices rose 3.2% in October, down from 3.7% in September.
The U.S. economy has remained strong, even though the Federal Reserve has hiked its main interest rate to its highest level since 2001 in hopes of stamping out high inflation.
With worries simmering over whether growth will remain resilient as full effects of those rate hikes make their way through the system, investors are watching to see if prices are still cooling.
The hope is that inflation will continue their decline from a peak of over 9% in the summer of 2022. That might convince the Federal Reserve no more hikes to rates are necessary and even speed up the timeline for potential cuts to interest rates.
With inflation generally cooling, Federal Reserve Chair Jerome a recent rise in longer-term Treasury yields might act as a substitute for further rate hikes. But Powell said last week the Fed would not hesitate to hike rates again if needed.
Early Tuesday, France's CAC 40 was up 0.1%, Germany's DAX picked up 0.4%a nd Britain's FTSE 100 fell 0.5%.
In Asian trading, Japan's benchmark Nikkei 225 gained 0.3% to finish at 32,695.93. Australia's S&P/ASX 200 advanced 0.8% to 7,006.70. South Korea's Kospi added 1.2% to 2,433.25. Hong Kong's Hang Seng lost nearly 0.2% to 17,396.86, while the Shanghai Composite edged up 0.3% to 3,056.07.
鈥淎sian stocks gained ground as investors awaited U.S. inflation figures, hoping to confirm that interest rates have peaked. Meanwhile, positive geopolitical sentiments filled the backdrop as investors looked forward to anticipated talks between the U.S. and China,鈥� Stephen Innes, managing partner at SPI Asset Management, said in a written commentary.
China is due to release monthly economic indicators on Wednesday, and Japan will announce its latest growth numbers.
U.S. budget politics also are on the agenda. The House of Representatives is preparing to vote on a to keep the U.S. government running into the new year and avert a federal shutdown. If approved, the Senate would act next, ahead of Friday鈥檚 deadline.
In other trading, benchmark U.S. crude oil lost 18 cents to $78.15 a barrel in electronic trading on the New York Mercantile Exchange. It gained $1.09 on Monday. Brent crude, the international standard, fell 14 cents to $82.38 a barrel.
In currency trading, the U.S. dollar dipped slightly to 151.70 Japanese yen from 151.72 yen. The euro rose to $1.0721 from $1.0701.
On Monday, Wall Street drifted to a mixed finish, as the S&P 500 slipped 0.1%. The Dow industrials gained 0.2% and the Nasdaq composite fell 0.2%.
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Yuri Kageyama And Matt Ott, The Associated Press
