A cooler than expected producer price index report boosted equities Thursday as it added to the view that the Federal Reserve might reverse its tightening campaign sooner. The Dow industrials rose 1.1 percent, the S&P 500 gained 1.3 percent, and the Nasdaq rallied 2.0 percent. US Treasury yields rebounded to close higher after an initial decline on the inflation news. The dollar rose and oil prices fell.

News that overall PPI dropped by 0.5 percent in March, below the expected unchanged figure, and an uptick in jobless claims, kicked off a rally led by growth stocks, especially megacap technology shares, which have lagged lately. Other best sectors included technology, communication services, consumer discretionary, and health care. Netflix and Amazon were among the biggest winners. Consumer shares including media & entertainment, restaurants, and travel & leisure rebounded from losses on earlier this week.

Lagging were cyclicals as the market increasingly sees a downturn, and defensive sectors such as consumer staples, real estate investment trusts, utilities, and telecom.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.