S&P Climbs, however Indicators Elevated Inflation to Persist Maintain Lid on Positive factors By Investing.com
By Yasin Ebrahim
Investing.com – The S&P 500 was up on Wednesday, but data showing that inflation remained high kept the uptrend in check amid fears the Federal Reserve might be forced to hike rates earlier than expected.
That rose 0.27%, that was flat, that rose 0.6%.
The increase rose 0.4% last month, above the 0.3% increase seen in August and more than 0.3% estimates. The September rise in consumer prices pushed the CPI up to 5.4% yoy from 5.3% in August.
Signs of price pressures emerging in sticker areas of the economy such as rents and tenant-equivalent rents will test the Federal Reserve’s ongoing narrative that inflation remains transitory.
“[P]The rice pressure is shifting to the stickier components and will make it harder to defend the Fed’s ‘temporary’ thesis, “Jefferies (NYSE 🙂 said in a note.
Financial stocks were the biggest drag for the broader market, accompanied by a decline in bank stocks as JPMorgan kicked off third-quarter earnings season.
JPMorgan Chase (NYSE 🙂 reported earnings of $ 3.74 per share on revenue of $ 29.65 billion for the third quarter, compared with estimates of $ 2.92 on revenue of 29.65 Billion dollars. The shares fell more than 2%.
BlackRock (NYSE 🙂 also delivered a blow in both sales and earnings, sending its shares up more than 3%.
Delta Air Lines (NYSE 🙂 posted a profit in the third quarter, but the airline warned that higher fuel costs will affect fourth quarter results. The stocks fell nearly 6%.
Energy cut some losses as oil prices rebounded from lows as demand was expected to continue to pick up.
Russian President Vladimir Putin said it was “quite possible” that the price of oil could rise above $ 100 a barrel.
Megacap technology was aided by the decline in government bond yields, but gains across the sector were held in check by weakness at Apple.
Apple (NASDAQ 🙂 fell 1% after Bloomberg reported, citing unnamed sources, that the tech giant is likely to cut production of the iPhone 13 by up to 10 million units amid ongoing global chip shortages.
Google parent Alphabet (NASDAQ :), Facebook (NASDAQ 🙂 and Amazon (NASDAQ 🙂 were above zero.
Investors are expected to turn their attention to monetary and economic clues when the Fed releases the minutes of its September meeting later on Wednesday.
The minutes should confirm the consensus among Fed members to start curbing bond purchases in November and shed light on the central bank’s deliberations on rate hikes.
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