Stocks open higher; Citi, Wells Fargo lead gains for banks

Stocks are opening broadly higher on Wall Street Wednesday as several big companies reported results that were better than analysts were expecting. The S&P 500 was up 0.5%. Several banks were rising after turning in strong quarterly earnings reports. Wells Fargo and Citigroup both rose. American Airlines jumped 6% after forecasting better results than the market was expecting. Investors were also keeping a close eye on the latest inflation report, which showed that wholesale prices rose 1% in June, pushing price gains over the past 12 months up by a record 7.3%. European markets were mixed and Asian markets closed lower.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

TOKYO — Global shares were mostly lower on Wednesday, tracking a decline on Wall Street as investors weighed the latest quarterly earnings reports from big U.S. companies and data pointing to rising inflation.

France’s CAC 40 edged down 0.2% to 6,544.96 in early trading, while Germany’s DAX shed nearly 0.2% to 15,765.96. Britain’s FTSE 100 slipped 0.4% to 7,094.19. The future for the Dow industrials slipped 0.2% to 34,729.00. The S&P 500 future edged 0.1% lower to 4,357.30.

Japan’s benchmark Nikkei 225 lost 0.4% to 28,608.49. Australia’s S&P/ASX 200 added 0.3% to 7,354.70. South Korea’s Kospi slipped 0.2% to 3,264.81. Hong Kong’s Hang Seng dropped 0.6% to 27,787.46, while the Shanghai Composite dipped 1.1% to 3,528.80.

“This backdrop of higher for longer U.S. inflation and a faster hiking Fed and strengthening USD is not a good recipe for emerging Asia,” said Robert Carnell, regional head of research Asia-Pacific at ING, referring to the U.S. currency.

Surging coronavirus cases in Indonesia, Malaysia and Thailand are another concern, he said. South Korea also is seeing cases jump. It released data showing an improvement in the jobless rate, but the numbers were collected before pandemic restrictions were tightened.

Some parts of Japan are also seeing an uptick in COVID-19 infections, fanning fears about the tens of thousands of athletes, dignitaries and other people from some 200 nations entering the country for the Tokyo Olympics. Tokyo has seen hundreds of new cases daily recently, with 1,149 cases reported Wednesday.

Some experts say that could jump to thousands in coming weeks, as the “bubble” conditions for the Olympians have been compromised, with staff and athletes testing positive for the virus. The Games open on July 23.

Investors got another snapshot of how inflation continues to show up in the economy as the a rapid spike in consumer demand and supply constraints translate into higher prices for consumer goods.

The latest report from the U.S. Labor Department showed yet another increase in consumer prices in June that surprised economists. Prices jumped by the most in 13 years, extending a run of higher inflation that has been raising concerns on Wall Street that the Fed might consider withdrawing its low-interest rate policies and scaling back its bond purchases earlier than expected.

Much of the increase in prices for goods, such as used cars, is mostly tied to a surge in demand and lack of supply. Prices for many items, like lumber and other raw materials, are easing or will ease as suppliers ramp up operations, said Jamie Cox, managing partner at Harris Financial Group.

In energy trading, benchmark U.S. crude lost 50 cents to $74.75 a barrel in electronic trading on the New York Mercantile Exchange. It picked up $1.15 to $75.25 on Tuesday. Brent crude, the international standard, fell 41 cents to $76.08 a barrel.

In currency trading, the U.S. dollar fell to 110.51 Japanese yen from 110.61 yen. The euro cost $1.1783, up from $1.1774.