Stocks rise broadly, Delta leads gains in travel companies

The S&P 500 rose 0.7% as of 12:08 p.m. Eastern. The Dow Jones Industrial Average rose 153 points, or 0.5%, to 34,371 and the Nasdaq rose 1.5%.

Travel-related companies were among the biggest gainers after Delta reported strong revenue during its first quarter and solid bookings. The update is encouraging for the broader travel sector as airlines, cruise lines and hotels prepare for the summer vacation season.

Delta rose 4.2% and rival American Airlines jumped 8.8%. Southwest and United Airlines rose more than 4%. Cruise line operators Carnival and Royal Caribbean also had solid gains, along with Expedia Group.

Technology stocks also did much of the heavy lifting for the broader market. Pricey valuations for many of the bigger technology companies lend more weight to directing the broader market higher or lower.

Banks slipped following a disappointing earnings report from JPMorgan, which fell 2.9% after revealing a sharp drop in profits as it wrote down nearly $1.5 billion in assets due to higher inflation and the Russian-Ukrainian War.

Bond yields fell. The yield on the 10-year Treasury fell to 2.66% from 2.72%.

The gains for stocks follow three straight losses for the benchmark S&P 500 index brought on by persistent worries about inflation and the tough medicine the Federal Reserve is planning to use against it, higher interest rates.

The Labor Department reported that the surging cost of energy pushed wholesale prices up a record 11.2% last month from a year earlier — another sign that inflationary pressure is widespread in the U.S. economy. That report comes a day after the department reported that consumer prices remain at their highest levels in generations.

The persistently rising inflation has prompted the Federal Reserve to tighten its monetary policy in order to temper the impact of inflation on businesses and consumers. The central bank has already announced a quarter-percentage point rate hike and is expected to continue raising rates through the year.

The Fed revealed in the minutes from its latest meeting that it’s prepared to hike short-term rates by half a percentage point, double the usual amount, at some upcoming meetings, something it hasn’t done since 2000.

Lingering concerns about inflation and rising interest rates have been worsened by Russia’s invasion of Ukraine. The conflict has made for volatile energy prices as oil supplies already remain tight amid rising demand. U.S. crude oil prices rose 1.6% and are up nearly 40% for the year. That has driven up gasoline prices and added to inflation’s hit on people’s wallets.