S&P 500 slips as hot inflation report hurts rate cut outlook By Investing.com

Investing.com — The S&P 500 ended lower on Thursday, as stronger-than-expected inflation data clouded the outlook for a Federal Reserve rate cut.

At 3:02 pm ET (2002 GMT), it was 151 points, or 0.4 percent, lower, down 0.4 percent and down 0.2 percent.

CPI data comes in hot and cool bets on big rate cuts

U.S. headline inflation slowed on an annual basis in September but was still faster than expected, giving the Federal Reserve less impetus to cut interest rates at a rapid pace.

(CPI) was 0.2% in September, unchanged from August but above the 0.1% expected. That took the annual pace through August to 2.4%, down from 2.5% in August but above expectations of 2.3%.

The core CPI, which excludes food and energy and is closely watched by the Fed, rose 0.3 percent, taking the annual pace through September to 3.3 percent, beating economists’ estimates of 2.3 percent.

“With an added focus on inflation, investors appear to be “recalibrating“ their outlook for rate cuts, reducing expectations for a second round of 50bp cuts in November and sending the 10-year back above 4% for the first time since July,” Stifel said in a note on Thursday.

As Fed talk continued, Atlanta Fed President Raphael Bostic’s remarks were noteworthy. Bostic said on Thursday that he was open to cutting interest rates by a quarter of a point, or that he might even support an unchanged decision if the recent headwinds of stronger inflation and the labor market persist.

Banks to kick off third quarter earnings season; The delta falls on the guide

This week also focuses on the third quarter earnings season, with a number of major banks due to report on Friday.

JPMorgan Chase (NYSE: ), Wells Fargo (NYSE: ) and Bank of New York Mellon (NYSE: ) are scheduled to report third-quarter earnings on Friday, while Goldman Sachs (NYSE: ), Bank of America (NYSE: ) and City Group (NYSE: ) will report earnings next week.

Earnings from Johnson & Johnson (NYSE: ), Unitedhealth Group (NYSE: ) and Walgreens Boots (NASDAQ: ) are also due early next week.

Earlier, shares of Delta Air Lines (NYSE: computer network and price pressures caused by overcapacity.

The company said it now expects to report adjusted fourth-quarter earnings per share between $1.60 and $1.85, missing Wall Street estimates of $1.78 in the middle, according to Bloomberg News.

Tesla robotaxi eye event; GXO implies selling; AMD drops as AI event begins

GXO Logistics Inc (NYSE: ) gained more than 14% after Bloomberg reported, citing unnamed sources, that the company is considering a sale. The report suggests, however, that a decision has yet to be made.

Tesla Inc (NASDAQ: ) fell 1% as investors waited for the electric vehicle maker to unveil its robotaxi at an event on Thursday.

Advanced Micro Devices Inc (NASDAQ: ), meanwhile, fell 4% as the chipmaker kicked off its AI event to showcase its latest plans, including new chips to compete with rival Nvidia ( NASDAQ:).

AMD announced on Thursday that it plans to ramp up production of its new M1325X artificial intelligence chip starting in the fourth quarter, and the chipmaker also unveiled a new server chip and announced a new AI chip to be released in the second half of next year.

(Peter Nurse, Ambar Warrick contributed to this article.)