(Bloomberg) — A rally in some of the world’s largest technology companies pushed stocks away from session lows in a volatile session that had traders digesting faster-than-anticipated inflation data.
Most Read from Bloomberg
The S&P 500 was little changed after a slide that topped 1.5% earlier Wednesday. Nvidia Corp. climbed 4% to lead gains in chipmakers. Financial, energy and industrial shares remained under pressure. Treasury yields edged up on bets the Federal Reserve will move gradually with rate cuts. Swap traders priced in a 25-basis-point Fed cut at next week’s gathering and see only a small chance for a half-point reduction.
Crypto, Prison Stocks Slide, Renewables Gain After US Debate
“While we’ve seen a slight pullback in stocks as of late with choppy earnings and economic data, we would expect more smooth sailing post this initial Fed rate cut and post-election, as uncertainty fades and investors start to price-in 2025 earnings,” said Skyler Weinand at Regan Capital.
The so-called core consumer price index — which excludes food and energy costs — increased 0.3% from July, the most in four months, and 3.2% from a year ago, Bureau of Labor Statistics figures showed Wednesday. The three-month annualized rate advanced 2.1%, picking up from 1.6% in July, according to Bloomberg calculations.
The S&P 500 hovered near 5,490. The Nasdaq 100 rose 0.6%. The Dow Jones Industrial Average slipped 0.5%. The Russell 2000 Index lost 0.3%. The KBW Bank Index slumped 1.3%.
Treasury 10-year yields advanced one basis point to 3.65%. The dollar fell. Oil climbed as Hurricane Francine ripped through key oil-producing zones in the US Gulf of Mexico, prompting traders to cover bearish bets.
“The firmer-than-expected core inflation print will make it harder for Jerome Powell to deliver a 50 basis-point cut in September,” said Krishna Guha at Evercore. “We continue to think a starter 50 basis-point cut is the right play and might even now win out. But the odds have moved against this, and risks to markets and the soft landing are higher as a result.”
Guha noted…
..
Great article! I really appreciate the clear and detailed insights you’ve provided on this topic. It’s always refreshing to read content that breaks things down so well, making it easy for readers to grasp even complex ideas. I also found the practical tips you’ve shared to be very helpful. Looking forward to more informative posts like this! Keep up the good work!