Stocks bounce back

NEW YORK (CNNMoney.com) -- Stocks jumped Friday morning, recovering some of the previous session's losses thanks to reports showing moderate economic growth and mild inflationary pressures.

The Dow Jones industrial average (up 69.15 to 13,284.28, Charts), the broader S&P 500 index (up 8.23 to 1,499.70, Charts) and the tech-fueled Nasdaq composite (up 12.76 to 2,546.50, Charts) all added around 0.6 percent roughly 90 minutes into the session.

Stocks slumped Thursday in a broad-based selloff, due to weak economic news and lackluster April retail sales. But the mood improved Friday, as investors sorted through the morning's economic news.

PPI, a measure of producer prices, rose 0.7 percent in April, topping estimates. However, the so-called core PPI, which strips out volatile food and energy prices, was unchanged, versus forecasts for a rise of 0.2 percent.

The report was a relief to investors following Wednesday's Federal Reserve meeting, in which the bankers said that they remained worried about inflation not moderating quickly enough. On that day, the Fed also held interest rates steady, as expected.

Friday also brought a weaker-than-expected reading on April retail sales and sales excluding autos. However, the report was not surprising to investors after Thursday's barrage of weak April sales reports from Wal-Mart Stores (down $0.18 to $47.57, Charts, Fortune 500) and others.

Additionally, market participants may be betting that the retail sales report reflects a weaker economy. A weaker economy, paired with mild inflation would suggest that the Fed is more likely to cut rates by the end of the year than raise them, a good thing for stocks.

Another report released shortly after the start of trade showed a surprise dip in March business inventories.

In corporate news, insurer AIG (up $0.31 to $72.51, Charts, Fortune 500) reported higher quarterly earnings that beat estimates late Thursday. Shares of the Dow stock were little changed Friday morning.

In deals news, Thomson said it is selling its education assets to private investors for about $7.75 billion in cash, a step toward buying news behemoth Reuters. Earlier this week, Thomson said it is in talks to buy Reuters.

In other merger news, the Chicago Mercantile Exchange (up $30.02 to $527.97, Charts) boosted its offer for rival CBOT Holdings (up $5.00 to $199.00, Charts) and added cash to what had previously been an all-stock offer. The revised bid led CBOT to again support the potential merger as opposed to a combination with the IntercontinentalExchange (up $4.83 to $139.68, Charts), which has also bid.

Amgen (down $1.64 to $55.69, Charts, Fortune 500) continued to slide on concerns about its anemia drugs one day after a U.S. panel of experts said it wants more restrictions on the use of anemia drugs in cancer patients. A variety of brokerages downgraded the stock on the news, including Citigroup and JP Morgan, Briefing.com reported.

Market breadth was positive. On the New York Stock Exchange, winners topped losers 3 to 1 on volume of 375 million shares. On the Nasdaq, advancers topped decliners 3 to 1 on volume of 460 million shares.

U.S. light crude oil for June delivery rose 19 cents to $62 a barrel on the New York Mercantile Exchange.

COMEX gold for June delivery rose $3.70 to $670.70 an ounce.

Treasury prices rose, lowering the yield on the 10-year note to 4.61 percent from 4.64 percent late Thursday. Treasury prices and yields move in opposite directions.

In currency trading, the dollar slipped against the euro and was little changed versus the yen.