Last updated: 10:40 AM EST
Stock indexes have been mixed so far in today’s trading session as traders wait to gauge the Federal Reserve’s next move following the weaker than expected Producer Price Index (PPI) for May. In fact, the PPI fell -0.2% month-on-month, below the 0.1% increase economists had predicted. Year-on-year, the PPI rose 2.2%, below the 2.5% expected.
Core PPI, which excludes food and energy prices, also slowed, finishing at 0% for the month and 2.3% for the year, respectively. Analysts had expected a 0.3% rise in the former and a 2.4% increase in the latter.
This has raised expectations that the Fed may start cutting interest rates this year, especially since yesterday’s summary of economic forecasts indicates the Fed is on track to cut rates once this year. Indeed, according to the CME FedWatch tool, investors now see a 61% chance of a rate cut in September, compared to 59% yesterday and 55% last week.
First Published: 5:03 AM EST
U.S. futures were mixed on Thursday morning following a strong trading session yesterday. Nasdaq 100 futures (Nedix) and the S&P 500 (Spocks) rose 0.72% and 0.15%, respectively, as of 4:49 a.m. ET on June 13, while the Dow Jones Industrial Average (DJIA) fell 0.28%.
The three major indexes ended yesterday in the positive, with the S&P 500 and Nasdaq Composite closing at record highs. The rise was driven by the US Consumer Price Index coming in below expectations for May, raising hopes of a possible interest rate cut in 2024. The US Federal Reserve also noted gradual progress towards its 2% inflation target, helping to bolster investor confidence.
Today, investors are awaiting the release of wholesale inflation data, represented by the Producer Price Index (PPI). Experts expect PPI to increase 0.1% in May, compared to a 0.5% increase in April. Additionally, initial jobless claims data for the week ending June 7 is also due to be released today.
Major aftermarket activity included Broadcom Inc.AVGO) rose nearly 13% after it reported better-than-expected second-quarter results and announced a 10-for-1 stock split. Meanwhile, Dave & Buster’splay) fell about 12% after weak first-quarter results. Virgin Galactic (spaceThe company’s stock price fell 9.6% after its board of directors approved a 20-for-1 reverse stock split.
Moving on to corporate earnings, Adobe (Adobe), Signet Jewelers (signature), Wiley (Wiley) is due to announce the results today.
Meanwhile, the yield on the 10-year US Treasury note has risen and is hovering around 4.32% at the time of writing. At the same time, WTI crude oil futures are also on an upward trend, hovering around $78.31 per barrel as of last check.
Meanwhile, European markets opened lower today as investors digested the US Federal Reserve’s interest rate decision and key US Consumer Price Index data.
Asia Pacific markets fall on Thursday
Most Asia Pacific stock indexes closed lower today as investors assessed US inflation data and the Fed’s decision to keep interest rates unchanged.
Japan’s Nikkei and TOPIX ended down 0.4% and 0.89% respectively. Similarly, China’s Shanghai Composite and Shenzhen Composite ended down 0.28% and 0.69% respectively. However, Hong Kong’s Hang Seng Index rose 0.97%.
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