Wednesday, July 24, 2024

Dow futures rose more than 800 points after October inflation report, lighter than expected


Stock futures rose on Thursday after the October reading of consumer prices raised hopes that inflation had peaked.

Futures linked to the Dow Jones Industrial Average jumped 844 points, or 2.6%. S&P 500 futures jumped 3%, while Nasdaq 100 futures rose more than 3.7%.

The Consumer Price Index, a broad measure of the costs of goods and services, rose only 0.4% for the month and 7.7% from last year. This was the lowest annual increase since January. Economists had expected increases of 0.6% and 7.9%, according to Dow Jones. Excluding volatile food and energy costs, core CPI rose 0.3% for the month and 6.3% year over year, also lower than expected.

“It definitely shows how much the markets are concerned, worried about and willing to act on the CPI if you get any kind of help here,” said John Briggs of NatWest. “It just brings up the idea of ​​peak inflation, peak Fed … the Fed will slow and peak instead of continuing to rise aggressively at 75 basis points like every time.”

Treasury returns It fell after the CPI report, with the 10-year Treasury yield falling more than 18 basis points to 3.946%, below the key 4% level. The two-year Treasury yield fell more than 23 basis points to 4.395%.

Technology stocks, which were the hardest hit this year with higher inflation and rates, led the gains in pre-market trading. Nvidia and Tesla shares rose more than 5%. Salesforce jumped 4%. Apple earned 3%.

Semiconductor stocks got a boost, with shares of Lam Research, KLA and Applied Materials each rising more than 5%.

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follow loss day With the Dow Jones down 646.89 points, or 1.95%. The Nasdaq Composite and S&P 500 are down nearly 2.5% and about 2.1%, respectively.

The declines came amid uncertainty caused by the US midterm elections. The market had hoped that Republicans would take overall control of the House and Senate on Tuesday – a situation that would create a stalemate in Washington, D.C. In fact, the race in the Senate between Raphael Warnock, the current Democrat, and Herschel Walker will do Head to the run-off in December.

Stocks’ woes worsened late Wednesday after cryptocurrency exchange Binance said it was Reversing plans to acquire rival FTX. This led to a decline in the technology sector and a decline Bitcointo the lowest level last seen in 2020.