S&P 500, Nasdaq climb amid more signs of cooling inflation

VaselineSeptember 12, 2024

0 4 minutes read

S&P 500, Nasdaq climb amid more signs of cooling inflation

U.S. stocks rose on Thursday as investors digested fresh inflation and labor data, testing high expectations for a quarter-point rate cut next week.

The S&P 500 (^GSPC) rose 0.5%, while the Nasdaq Composite (^IXIC) gained 0.7%, following strong closing gains fueled by a tech rally. The Dow Jones Industrial Average (^DJI) rose 0.2%.

The market is building on a Wednesday swing that ended with revived enthusiasm for technicians. Meanwhile, the latest major data this week bolstered bets on a smaller 25 basis point rate cut from the Federal Reserve next week instead of a larger 0.5% cut.

Early Thursday, the August producer price index provided another indication that inflationary pressures are easing. Wholesale prices rose at a rate of 0.2% month-on-month, slightly above what economists had anticipated. On an annual basis, the PPI rose 1.7%, in line with expectations, while July’s reading was revised downward. This followed August’s consumer price reading, which also showed a gradual cooling.

Read more: Fed forecasts for 2024: What experts say about the possibility of a rate cut

Meanwhile, data on the job front showed initial jobless claims rose more than expected to 230,000 last week, up 2,000 from the previous weekly period. Traders’ odds of a 25 basis point discount rose to 87% after the reports, compared to 50% just a few days ago.

On the corporate front, shares of Moderna ( MRNA ) fell as much as 17% after the vaccine maker cut its annual revenue forecast for 2025. The company also said it would cut its annual research and development budget.

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Thursday, September 12, 2024 at 19:30 GMT+2

Gold hits all-time high as investors await Fed rate cut

Gold hit an all-time high on Thursday as investors await a Fed interest rate cut next Wednesday. The precious metal is up more than 24% year-to-date, far outperforming the broader markets.

Gold futures (GC=F) rose more than 1 percent to $2,576 an ounce. Silver futures ( SI=F ) also rose 3% to trade above $30 an ounce.
Thursday, September 12, 2024 at 18:45 GMT+2

GM and Hyundai to jointly explore cars in development to ‘unlock scale’

Pras Subramanian of Yahoo Finance reports:

GM ( GM ) and Hyundai ( HYMTF ) signed an agreement Thursday morning to jointly explore developing cars, powertrains and various technologies, signaling how far the Korean automakers have come in the past 30 years .

According to the non-binding memorandum of understanding signed by Hyundai Motor Group Executive Chairman Euisun Chung and GM CEO Mary Barra, the two companies will collaborate and jointly develop projects including production of passenger and commercial vehicles and propulsion technologies such as would be gas engines. and clean energy options, which would include electric and hydrogen options.

The two automaker giants said they would examine opportunities to combine resources for raw materials for batteries, steel and other commodities.

Read more here.
Thursday, September 12, 2024 at 18:00 GMT+2

Mortgage payments cheaper than a year ago thanks to rate drop: Redfin

Buying a home has become more affordable than it was a year ago, according to new data from Redfin.

Redfin found that the average monthly mortgage payment reached $2,558 in the last four weeks through September. This is a decrease of 1.3% compared to last year.

A big help was the drop in mortgage rates. The average rate on a 30-year fixed-rate mortgage fell to 6.2 percent this week, according to data from Freddie Mac. Mortgage rates have fallen by more than half a percentage point in the past six weeks as investors anticipate a rate cut from the Fed. They are at their lowest level since February 2023.

However, house prices have not fallen from their peak. The median sales price is $388,085, up 3.7 percent year over year, Redfin data shows. Home prices remain high due to a lack of supply. That, plus buyers’ expectations that rates will fall after the Fed eases monetary policy, continues to keep the housing market at a standstill.
Thursday, September 12, 2024 at 17:25 GMT+2

Apple receives FDA approval for software for AirPods hearing aids

Apple ( AAPL ) has received approval from the US Food and Drug Administration for its hearing aid software to be used in AirPods.

The feature was first revealed at the tech giant’s annual product launch in California earlier this week.

Once installed and customized, the over-the-counter hearing aid software is “intended to amplify sounds for people 18 years of age or older with mild to moderate perceived hearing loss,” according to the FDA statement.
Thursday, September 12, 2024 at 16:35 GMT+2

‘No huge surprises’: Why Apple shares didn’t move much on iPhone 16 news

Yahoo Finance’s Madison Mills reports:

Apple’s artificial intelligence offering, Apple Intelligence, was the star of its annual iPhone event on Monday.

But for investors, the slow rollout of Apple Intelligence could be a problem. While Apple’s iPhone 16 hits stores on September 20, the software update required for Apple Intelligence won’t be available to US English users until October.

The disconnect between hardware and software may have been one reason why Apple stock didn’t move much on the news. Shares of the iPhone maker fell about 0.9 percent during the company’s “Glowtime” presentation in Cupertino, California, and rose less than 1 percent in the three days since the event.

Read more here.
Thursday, September 12, 2024 at 16:08 GMT+2

Delta issues strong outlook despite summer tech glitches

Shares of Delta ( DAL ) jumped before slipping into negative territory on Thursday after the airline said its full-year profit would reach the midpoint of its previous forecast range despite a computer error earlier this summer.

The airline sees full-year adjusted earnings per share of $6.50 or higher, up from a previous estimate of $6 to $7, excluding the impact of a worldwide technology outage in July.

Delta shares fell nearly 2 percent in early trading.
Thursday, September 12, 2024 at 15:32 GMT+2

Stocks hold up amid falling inflation data, higher-than-expected jobless claims

Stocks were little changed on Thursday as investors digested a new batch of data that could provide clues about how much of a rate cut the Federal Reserve will decide to implement at its policy meeting this month.

The S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) were flat, coming off strong closing gains fueled by a tech rally. The Dow Jones Industrial Average (^DJI) was also little changed.

As for inflation data, the producer price index rose 0.2 percent in August from a month earlier, slightly more than economists had expected. Meanwhile, July’s PPI reading was revised down. Year-on-year, wholesale prices rose 1.7%, in line with expectations.

Initial weekly jobless claims rose 2,000 to 230,000, more than economists had anticipated.

Investors are paying close attention to these data as the Federal Reserve prepares to meet next week. Markets had widely anticipated a rate cut. What is not known is how big that cut will be.