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S&P 500 index decline after hot inflation printing

The Elite Times TeamBy No Comments5 Mins Read

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U.S. stocks reversed Thursday morning after the release of big, better-than-expected inflation data. The data was one of the last pieces of data that could sway the Federal Reserve at next week’s policy meeting.

The S&P 500 (^GSPC) fell 0.2% and the Dow Jones Industrial Average (^DJI) fell 0.2%. The Nasdaq Composite Index (^IXIC), which has a high proportion of high-tech stocks, fluctuated around the flatline. Nvidia (NVDA) and Tesla (TSLA) stock prices fell following losses in pre-market trading on Thursday.

The producer price index rose 0.6% in February, beating expectations for a 0.3% rise. Investors were watching whether inflation cooled quickly enough to satisfy Fed policymakers and threaten a rate cut. That said, markets ignored signs of persistent inflation in Tuesday’s CPI report and held firm to hopes of a policy reversal in the summer.

Meanwhile, retail sales rose 0.6%, falling short of the expected 0.8% increase. All eyes were on Thursday’s release of statistics for clues about the health of the U.S. economy ahead of next week’s two-day central bank meeting.

In primary products, crude oil continued its resurgent rally after the IEA warned that supplies would be delayed this year and U.S. stockpiles would shrink. WTI crude oil futures (CL=F) remained just above $81 a barrel, the highest since November, while Brent crude oil futures (BZ=F) rose above $85.

On the corporate side, Fisker (FSR) stock plummeted more than 40% following a Wall Street Journal report that the electric vehicle maker was considering filing for bankruptcy.

live5 updates

  • Fed’s cautious approach to rate cuts is reinforced by new inflation indicators

    New evidence of inflation’s persistence released Thursday is likely to strengthen the Fed’s cautious approach to rate cuts, raising questions about whether interest rates will remain higher for longer than expected in 2024. It is likely to increase further.

    Yahoo Finance’s Jen Jennifer Schonberger reports:

    “Given the unexpectedly sticky nature of inflation, it will be very difficult for the Fed to justify a near-term rate cut,” Stifel’s Lindsey Piegza told Yahoo Finance Live on Thursday. “Our base case is that the Fed holds off until the second half of this year before initiating policy changes.”

    Thursday’s new inflation figures came from the Labor Department’s Producer Price Index, which tracks the prices businesses pay to make goods and services.

    The index rose 0.6% in January-February, up from 0.3% in the previous month. So-called “core” producer prices, which exclude volatile food and energy costs, rose 0.3% from the previous month. The Fed is closely monitoring core prices.

  • Drone attack on Russian refinery boosts crude oil profits due to inventory decline

    Oil prices rose more than 1% on Thursday, adding to gains in early trading as inventories fell and drone attacks on Russian refineries continued.

    On Tuesday, West Texas Intermediate (CL=F) hovered just above the $81/barrel level, while international benchmark price Brent (BZ=F) rose above $85/barrel. Traded.

    U.S. crude oil inventories fell last week, according to Energy Information Administration data.

    The escalation of drone attacks on Russian refineries in recent days in the wake of the Ukraine-Russia war has also affected the oil market.

  • Stock prices reverse due to higher-than-expected inflation

    Stocks started higher, but quickly turned negative in early trading.

    The S&P 500 (^GSPC) fell 0.3%, and the Dow Jones Industrial Average (^DJI) also fell 0.4%, or about 100 points. The Nasdaq Composite Index (^IXIC) also fell below the flatline.

    Nvidia (NVDA) opened lower for the second day in a row. On Wednesday, the chipmaker’s stock price along with Tesla (TSLA) dragged down its stock price.

    The producer price index rose 0.6% in February, beating expectations for a 0.3% rise. Investors were eyeing the printout as the last major data point ahead of the Federal Reserve’s major policy meeting next week.

  • Stocks rise slightly despite higher-than-expected inflation

    Stocks rose modestly on Thursday despite a sharper-than-expected inflation record.

    The S&P 500 (^GSPC) rose 0.1% and the Dow Jones Industrial Average (^DJI) rose 0.3% or more than 100 points. The Nasdaq Composite Index (^IXIC) also rose 0.2%, rebounding from yesterday’s decline.

    Nvidia (NVDA) opened lower for the second day in a row. On Wednesday, the chipmaker’s stock price along with Tesla (TSLA) dragged down its stock price.

    The producer price index rose 0.6% in February, beating expectations for a 0.3% rise. Investors were keeping an eye on the printout as expectations grew that Fed policymakers would reiterate their intention to cut interest rates this year after next week’s Fed meeting.

  • Retail sales recover

    Retail sales rebounded in February after suffering the steepest decline in almost a year last month.

    Retail sales rose 0.6% in February from the previous month, according to Census Bureau data. Economists had expected spending to rise 0.8%, according to Bloomberg data. Retail sales had previously fallen by an unexpected 1.1% in January.

    Sales excluding cars and gasoline rose 0.3% in February, in line with expectations.

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