Wall Street stocks swung wildly yesterday as good news on the US economy was both celebrated and ignored by manic-depressive investors. In the first hour of trading, the blue-chip index charged up 80 points and then plummeted to 70 points down, before bouncing between negative and positive territory for the rest of the session.

Causing the dramatic swings were two separate US government reports on the economy. The Labour Department said that prices paid to factories and to other producers fell by 0.1 per cent in July for the seventh successive month. Economists had predicted a 0.1 per cent rise.

That was good news because it showed that inflation, a big concern for bond investors, is under control.

At the same time the Commerce Department reported that retail sales rose 0.6 per cent in July, the second consecutive increase. That was about in line with expectations.