Stocks surged from Wednesday as better-than-expected inflation data was released just after the Federal Reserve concluded its June meeting, and two of the three major indexes held on to gains after the central bank cut its forecast for interest-rate cuts this year.
Prior to the opening, Bureau of Labor Statistics The May headline CPI was flat from the previous month and up 3.3% from a year earlier. April CPI Report It fell short of economists’ expectations.
Food and energy Prices also moderated, rising 0.2% from the previous month and 3.4% from a year earlier, after rising 0.3% from the previous month and 3.5% from a year earlier in April.
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“The first quarter inflation fever is reversing, housing deflation continues and auto insurance prices are falling,” it said. Sonu VargheseJohn McCain, global macro strategist at Carson Group, added that today’s data “puts the Fed on track to cut rates in 2024, with the first cut likely coming in September.”
Following the May CPI report, market expectations for a rate cut in September jumped to 61% from 47% the previous day, according to a CME Group survey. FedWatchTools.
Fed cuts forecast for 2024 rate cuts
However, after the Fed’s announcement in the afternoon, the odds fell to 58%. Dot plot The central bank now expects just one 0.25 percentage point rate cut this year, down from three in March, the report showed.
middle What the Fed called a “moderate” improvement In bringing inflation down to its 2% target, the central bank Federal Funds Rate The highest level in 23 years.
At a later press conference, Fed Chairman Jerome Powell gave market participants no additional hints about the central bank’s next moves, reiterating its data-driven approach. Interest level And inflation.
Oracle shares surge on new AI deal
In individual stock news, Oracle (ORCL) stock price is up as the software company splits into two Artificial Intelligence (AI) Trading is Gaining Attention and Alphabetical (GOOGL, +0.7%) Google and OpenAI, which, along with CEO Safra Catz’s prediction of “double-digit revenue growth” for the current fiscal year, helped make up for the company’s fourth-quarter profit shortfall.
Tesla TSLA also showed a big movement, 7 Great Stocks Shares close up 3.9% ahead of shareholder vote Restoring CEO Elon Musk’s estimated $56 billion compensation package.
“We have long argued that Musk’s innovation is one of the primary reasons this stock trades at such a high multiple,” analysts at CFRA Research said. Garrett Nelson (Buy). “If the compensation package is rejected, we believe it could increase uncertainty about the company’s future leadership and jeopardize the ‘Musk premium.'”
Target maintains record annual dividend increase
the goal (TGT, +0.4%) was also in the spotlight Wednesday. Discount retailer It raised its quarterly dividend by 1.8%.This is also true for TGT. Best Dividend Stocks for Steady Dividend GrowthIn fact, the company has increased its dividend for 53 consecutive years.
The retailer is generally well-liked on Wall Street, as evidenced by 35 Wall Street analysts tracking the stock and giving it a buy recommendation rating. S&P Global Market IntelligenceAnalysts at Argus Research are expressing the bullish view. Chris Graja (Buy) says Target has earned its place as the “go-to” retailer. Consumer Staples Stocks This should be seen as a buying opportunity.
Regarding the main indicators, Nasdaq Composite Index (+1.5% 17,608) S&P 500 (+0.9% to 5,421) closed at a new record high. Dow Jones Industrial Average It ended at 38,712, down 0.09%. Salesforce (CRM, -2.2%).
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