WALL Street stocks rallied last night amid signs that inflation had remained tame despite worrisome indications a day earlier that spurred a 160-point tumble by the Dow industrials.

The Dow Jones industrial average gained 56.57 points to close at 6,935.46, taking back about a third of Thursday's slide, which was the blue-chip barometer's fifth-worst point drop ever.

Broad-market indexes also recaptured a chunk of Thursday's losses.

In stark contrast to Thursday's robust economic readings, the labour department reported that wholesale prices paid to farms and factories fell by 0.4 per cent last month.

Advancing issues outnumbered decliners by a four-to-three margin on the NYSE.