Last Updated: 4:10 PM EST
Stock indices finished today’s trading session in the green. The Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) gained 0.09%, 0.38%, and 0.61%, respectively. Earlier today, the U.S. Bureau of Labor Statistics released its monthly inflation report.
Core CPI came in at 3.2% year-over-year and 0.2% month-over-month. Both figures were in line with estimates. In addition, yearly and monthly headline CPI figures were 2.9% and 0.2%, respectively. The former beat expectations of 3% while the latter was also in line.
As a result of today’s numbers, investors are now pricing in a higher chance of a 25 basis-point rate cut for September instead of a 50 basis-point cut. According to the CME FedWatch tool, the implied probability is now 64.5% for the smaller cut.
First Published: 5:13 AM EST
U.S. futures were flat on Wednesday morning as investors braced for another key inflation report. Futures on the Nasdaq 100 (NDX) and S&P 500 (SPX) were down by about 0.14% and 0.06%, respectively, at 4:23 a.m. EST, August 14, while the Dow Jones Industrial Average (DJIA) was up 0.04%.
The U.S. stock market surged on Tuesday as investors welcomed cooler-than-expected inflation data that raised hopes for a larger Fed rate cut in September. The Nasdaq Composite, the S&P 500, and the Dow Jones indices closed higher by 2.4%, 1.7%, and 1%, respectively.
In major news, Starbucks (SBUX) was the biggest gainer on the S&P 500 yesterday, soaring 24.5% after the company announced that Chipotle (CMG) CEO Brian Niccol will take the helm as Starbucks’ new CEO. On the other hand, Chipotle stock was down 7.5% on the news. Further, Alphabet (GOOGL) shares declined about 1% in extended trading on news that the Justice Department is considering an antitrust lawsuit to break up Google.
Moving to today’s economic reports calendar, the Consumer Price Index (CPI) data for July is due for release at 8:30 a.m. EST today. Economists expect the core inflation rate, which excludes prices for food and energy, to have increased by 0.2% sequentially.
This key report sheds light on price trends in the economy and holds significance for the Federal Reserve’s monetary policy decisions. According to the CME Group’s Fedwatch Tool, the probability of the first-rate cut occurring in September is currently 100%.
Moving to corporate earnings, Tencent Holdings (TCEHY), Cisco (CSCO), and Canoo (GOEV) are slated to release their results today.
Meanwhile, the U.S. 10-year treasury yield was down, floating near 3.85% at the time of writing. The WTI crude oil futures are trending higher, hovering near $78.78 per barrel as of the last check.
Elsewhere, European indices opened higher on Wednesday morning as investors continued to assess the inflation reports from the U.S. and U.K.
Asia-Pacific Markets Traded Mixed on Wednesday
Asia-Pacific indices were mixed today as investors awaited a slew of economic reports from China, due for release tomorrow, to gain insight into the economy. At the same time, traders rejoiced over favorable U.S. producer inflation data, which supported expectations for interest rate cuts.
Hong Kong’s Hang Seng index was down 0.36%. Further, China’s Shenzhen Component and Shanghai Composite indices declined by 1.17% and 0.6%, respectively. However, Japan’s Nikkei and Topix indices closed up by 0.58% and 1.11%, respectively.
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