Stocks up in early trading on inflation, housing data

Stocks rose in early trading Wednesday following a benign reading on consumer inflation and a rebound in housing starts. Consumer prices excluding food and energy were flat in November, signaling that inflation isn't working its way into the economy. It was the first time that "core" inflation was unchanged after 10 monthly increases. Meanwhile the Commerce Department said construction of homes and apartments rose 8.9 percent last month. The reports come as Federal Reserve policymakers wrap up a two-day meeting on interest rate policy. Investors expect the Fed will hold rates near zero. The Fed's statement following its meeting is expected at 2:15 p.m. EST. On Tuesday, stocks fell for the first time in five days and Treasurys slipped after a jump in wholesale prices led to speculation that the Fed would be would be forced to raise interest rates sooner than expected. The latest reports eased some of those concerns. In midmorning trading, the Dow Jones industrial average rose 46.71, or 0.5 percent, to 10,498.71. The broader Standard & Poor's 500 index rose 6.53, or 0.6 percent, 1,114.16, and the Nasdaq composite index rose 16.71, or 0.8 percent, to 2,217.76. Meanwhile, bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.57 percent from 3.60 percent late Tuesday. A drop in the dollar from a two-month high boosted commodity prices. Gold rose, while crude oil 98 cents to $71.67 per barrel on the New York Mercantile Exchange. Intel Corp. was the biggest decliner among the 30 stocks that make up the Dow industrials after the Federal Trade Commission accused the chipmaker in a lawsuit of using tactics to snuff out competition. Intel fell 33 cents, or 1.7 percent, to $19.47. Separately, the European Union dropped antitrust charges against Microsoft Corp. after the company agreed to give users of the Windows operating system a choice of up to 12 other Web browsers. Microsoft rose 30 cents, or 1 percent, to $30.31. Three stocks rose for every one that fell on the New York Stock Exchange, where volume came to 166.8 million shares compared with 157.7 million shares traded at the same point Tuesday. Overseas, Japan's Nikkei stock average rose 0.9 percent. In afternoon trading, Britain's FTSE 100 was up 0.2 percent, Germany's DAX index was up 1.1 percent, and France's CAC-40 was up 0.7 percent.