Dow Jones Surges 510 Points as Long Yields Back Off

The Dow Jones Industrial Average (DJIA) rallied on Friday, gaining roughly 510 points and nearing 52,600. The rally came as long yields backed off, with the 10-year Treasury yield rising to 5.00% before reversing course and trading near 4.90%. This rebound was a welcome respite from four consecutive sessions of losses.

The inflation print released on Friday contributed about 100 points to the DJIA's advance at 12:30 GMT, with the core CPI increasing 0.3% in August, above the expected 0.2%. The annual core rate eased to 2.4% from 2.5%, while gasoline rose 3.9% and did more than a third of the monthly increase on its own.

However, not all sectors benefited from the rally. Crude Oil is lower on the day, and American diesel set a record at $6.05 per gallon, up from $5.32 a month ago. This price increase weighed on energy prices, with Chevron (CVX) being the only member of the DJIA to pay rather than charge for it.

The consumer sentiment survey by the University of Michigan showed a decline in sentiment to 47.8 in September, down from 51.7 and below the consensus estimate of 51. The expectations component fell to 45.8 from 51.5, with year-ahead inflation expectations jumping to 4.6% from 4.0%, and the five-year measure rising to 3.4% from 3.3%.