Last Updated 4:05 PM EST
Stock indices finished today’s trading session in the green amid slowing inflation data. The Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) gained 1.73%, 0.85%, and 0.14%, respectively.
The energy sector (XLE) was the session’s laggard, as it fell 0.36%. Conversely, the technology sector (XLK) was the session’s leader, with a gain of 2.25%.
Furthermore, the U.S. 10-Year Treasury yield decreased to 3.76%. The Two-Year Treasury yield also decreased, as it hovers around 4.62%. This brings the spread between them to -86 basis points.
Compared to yesterday, the market is pricing in a higher chance of a lower Fed Funds rate for December 2023. In fact, the market’s expectations for a rate in the range of 5.5% to 5.75% decreased to 15.6% compared to yesterday’s expectations of 21.3%.
In addition, the market is now also assigning a 21.8% probability to a range of 5% to 5.25%. For reference, investors had assigned a 18% chance yesterday.
Last Updated: 12:00PM EST
Stocks continue to rally so far in today’s trading session. At the time of writing, the Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) are up 1.2%, 0.6%, and 0.1%, respectively.
In addition, WTI crude oil is also up today as it hovers around $76 per barrel. Its recent uptrend has led to prices at the pump gaining upward momentum across the country. Indeed, the national average for regular gas was last $3.555 per gallon, up from last week’s reading of $3.529.
The highest prices can be found in California, where prices are substantially higher than the national average, at $4.902 per gallon. On the other hand, Mississippi is the state with the lowest gas prices, at $2.993 per gallon.
Last updated: 9:30AM EST
Stock markets opened higher on Thursday after another round of economic data indicated a further cooling down in the U.S. economy. The Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) are up 0.8%, 0.5%, and 0.28%, respectively, at 9:30 a.m. EST, July 13.
The economic data released today indicated that the Producers’ Price Index (PPI) went up at a slower pace by 0.1% in June, lower than economists’ forecasts of a 0.2% increase versus a decline of 0.3% in May. This was the lowest rise in PPI since September 2020. On a yearly basis, PPI rose by only 0.1%, less than the expected rise of 0.5% and again at a slower rate than the 1.1% increase in May.
Core PPI, which excludes food and energy, edged up by 0.1% in June versus a forecast of an increase of 0.2%. On an annualized basis, core PPI was up by 2.4% as compared to estimates of 2.8%.
When it comes to jobless claims, initial jobless claims for the week ending July 8 indicated that jobless claims dropped unexpectedly by 12,000 to 237,000 as compared to economists’ forecasts of 250,000 and as compared to claims of 249,000 in the prior week (revised from 248,000).
Continuing jobless claims came in at 1.729 million versus forecasts of 1.723 million and compared to 1.718 million (revised from 1.720 million).
First published: 4:14AM EST
U.S. Futures are trending in positive territory on Thursday morning, following the cooler-than-expected inflation print reported yesterday. Futures on the Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) are up 0.56%, 0.31%, and 0.19%, respectively, at 4:00 a.m., EST, July 13.
The U.S. CPI grew 0.2% in June and 3% on an annualized basis, putting to rest widespread recessionary fears. At the same time, core CPI (excluding food and gas) grew 0.2% in June and 4.8% for the twelve months, lower than the 5% expectations. Traders cheered the easing inflation numbers and pushed the SPX and the Nasdaq Composite higher yesterday, hitting their highest levels since April 2022. Markets are hoping that the Federal Reserve may not resort to aggressive monetary policy measures since inflation is declining, albeit at a slow pace. Another important inflation gauge on the Fed’s radar, the producer price index (PPI) data, is due at 8:30 a.m. EST today.
With inflation pressure seeming to ease, traders will now focus on the second-quarter earnings season that kicks off today. Beverage giant PepsiCo (PEP), airline bellwether Delta Airlines (DAL), and FMCG player Conagra Brands (CAG) report before the bell today. Meanwhile, financial giants including JPMorgan Chase & Co. (JPM), Wells Fargo (WFC), Citigroup (C), BlackRock (BLK), and State Street (STT) will release their earnings tomorrow, July 14.
Moreover, Walt Disney (NYSE:DIS) shares rose over 1% in extended trading yesterday on the news of CEO Bob Iger’s contract extension for two years. On the other hand, cybersecurity stocks plunged in the after-hours yesterday following the news that tech giant Microsoft (NASDAQ:MSFT) is soon entering the network security sector, posing stiff competition to existing players.
Elsewhere, European indices are trading near the flatline this morning. While markets are cheering the U.S.’s cooling inflation print, reports from the U.K. continue to daunt investor sentiment. As per official statistics, the U.K. economy contracted 0.1% in May, although less than the 0.3% expected contraction. Even so, sticky inflation, contrasted with high wage growth reported recently, poses a challenge to economic revival.
Asia-Pacific Markets End Higher on Thursday
Asia-Pacific indices ended higher on Thursday following the positivity of the easing inflation print in the U.S.
On the other hand, China’s exports reported a significant decline in June, falling by 12.4% compared to the prior-year period. Also, imports fell more than expected by 6.8% in June compared to the year-ago period. The Chinese government has a tough road ahead to bolster the economy, mainly driving higher domestic demand since global markets are pressured by high inflation, impeding global demand.
Hong Kong’s Hang Seng and China’s Shanghai Composite and Shenzhen Component indexes ended higher by 2.63%, 1.26%, and 1.61%, respectively.
Similarly, Japan’s Nikkei and Topix indices finished up by 1.49% and 0.97%, respectively.
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