US stocks rebound as investors shake off inflation amid fears of interest rate hike

By Ovunc Kutlu

ANKARA (AA) - US stocks rebounded strongly Thursday to close higher as investors shook off inflation worries that could lead to a higher interest rate hike by the US Federal Reserve.

The Dow jumped 827 points, or 2.8%, to close at 30,038. The S&P 500 added 92 points, or 2.6%, to 3,669.

The Nasdaq soared 232 points, or 2.2%, to 10,649, bouncing back from its lowest level in two years.

US annual consumer inflation came in at 8.2% in September, slightly easing from the 8.3% yearly gain in August, but higher than estimates of an 8.1% annual increase.

The Fed has increased its benchmark interest rate by a total of 300 points since March to tame record inflation, while it is expected to make another rate hike of 75 basis points in November, followed by an additional increase of 50 basis points in December.

The VIX volatility index, also known as the fear index, was down 4.8% to 31.94 The 10-year US Treasury yield rose 1.5% to 3.962%.

The dollar index fell 0.7% to 112.47, but is still around its highest in 20 years, while the euro rose 0.7% to $0.9777 against the greenback.

Precious metals were on the decline, with gold shedding 0.45% to $1,665 and silver falling 0.8% to $18.87.

Oil prices reversed course and posted gains. Global oil benchmark Brent crude was trading at $94.71 per barrel for a 0.4% increase. US benchmark West Texas Intermediate was around $89.22 -- up 2.2%.