Last Updated: 4:30 PM EST
Stock indices finished in the green after today’s inflation report. Indeed, the Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) gained 2.17%, 1.07%, and 0.31%, respectively. Today’s Core CPI report came in at 3.2% year-over-year and 0.3% month-over-month. For reference, economists were expecting 3.2% for the former and 0.2% for the latter. In addition, yearly and monthly headline CPI figures were 2.5% and 0.2%, respectively, which were both in line with estimates.
As a result, compared to yesterday, the market is pricing in a higher chance of a 25 basis-point rate cut from the Federal Reserve next week. In fact, the market’s expectations for a rate in the range of 5% to 5.25% increased to 85% compared to last week’s expectations of 56%.
In a separate development, the Energy Information Administration (EIA) released its weekly Crude Oil Inventories report, which measures the weekly change in the number of barrels of commercial crude oil held by U.S. firms.
Compared to a week ago, inventories increased by 0.833 million barrels. For reference, economists were expecting an increase of 0.9 million barrels week-over-week. This means that demand was stronger than anticipated. Nevertheless, WTI crude oil settled $2.96 lower to $65.75 per barrel.
First Published: 3:18 AM EST
U.S. futures inched lower on Wednesday morning as investors braced for August’s consumer inflation report. Futures on the Nasdaq 100 (NDX), the S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were down by about 0.36%, 0.29%, and 0.28%, respectively, at 2:53 a.m. EST, September 11.
In Tuesday’s stock market performance recap, the Dow Jones index declined slightly by 0.23%. However, the S&P 500 and Nasdaq Composite indices gained ground, rising 0.45% and 0.84%, respectively.
Moving to notable stock moves, Oracle (ORCL) tops the list, having gained 11.4% yesterday, buoyed by an impressive fiscal first-quarter earnings report. Conversely, Hewlett Packard Enterprise (HPE) stock declined over 7% on a $1.5 billion convertible stock offering. Further, shares of JPMorgan Chase (JPM) were down 5.2% after the bank’s chief operating officer said that its 2025 net interest income estimates might be overly optimistic.
In light of these market movements, investors are eagerly awaiting the release of the August CPI report. Economists anticipate a slight increase in inflation of 0.2% month-over-month and 2.6% year-over-year. This key economic indicator, along with the Producer Price Index, due on Thursday, will impact the central bank’s interest rate cut decision at the upcoming meeting.
Investors should note that the CME Group FedWatch Tool suggests a high probability of 65% for a 25-basis-point rate cut at the Fed’s next meeting. However, there is also a possibility of a more aggressive 50-basis-point reduction.
Meanwhile, the U.S. 10-year treasury yield was down, floating near 3.622% at the time of writing. In contrast, the WTI crude oil futures are trending higher, hovering near $66.38 per barrel as of the last check.
Elsewhere, European markets opened higher on Wednesday as investors looked forward to key U.S. inflation reports.
Asia Pacific Markets Traded Lower on Wednesday
Most of the Asia-Pacific markets traded in the red today as investors remained cautious ahead of the key U.S. inflation data.
At the time of writing, Hong Kong’s Hang Seng and China’s Shanghai Composite indices were down 0.86% and 0.89%, respectively. Moreover, Japan’s Nikkei and Topix indices dropped 1.49% and 1.8%, respectively. On the other hand, China’s Shenzhen Component index gained 0.29%.
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