S&P 500, Nasdaq lead Wall Street rebound ahead of Trump-Xi meeting, CPI data

The dip that Wall Street witnessed in mid-week trading was quickly bought into on Thursday, despite a mixed batch of corporate earnings and ahead of a much awaited inflation data report.

The Dow Jones gained nearly 150 points, recovering half of the losses that it saw on Wednesday, while the S&P 500 and Nasdaq gained 0.6% and 0.9% respectively, recovering nearly all of the mid-week drop.

Honeywell Inc. led the gains on the Dow Jones with a 7% surge after better-than-expected results that also prompted the company to raise its full-year guidance. American Airlines also reported a narrower-than-expected loss and gave upbeat guidance that took the stock higher by 6%.

Gains among tech names were led by Broadcom, Amazon and Oracle, along with a recovery in Tesla, which ended with gains of over 2% despite a mixed set of results.

Hopes of a trade deal between the US and China also rose after the White House announced that US President Donald Trump will meet Chinese President Xi Jinping on the sidelines of the APAC summit in South Korea on October 30. The meeting assumes significance ahead of the November 1 threat from Trump to impose an additional 100% tariff on Chinese exports and a November 10 deadline of an official truce between the two countries on tariffs.

The consumer price inflation (CPI) data for September is the most awaited data point of the evening as the Bureau of Labor Statistics will be releasing the numbers later this evening despite the government shutdown.

Economists expect the core CPI for September to rise 0.3% month-on-month and 3.1% year-on-year in September, the same as August. However, a higher-than-Fed-target CPI will not prevent the US Federal Reserve from cutting interest rates next week as the central bank is likely to lay more emphasis on the weak labor market conditions.

The US Dollar index remains around levels of 99, while Gold prices saw some dip buying after steep losses this week. Brent crude is back near the $66 per barrel mark, after a 5.5% surge overnight.