The yield on the Treasury jumped after strong inflation data

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The S&P 500 and Nasdaq Composite slid 1% each.
7 S&P 500 stocks hit new 52-week lows The major stock averages declined on Wednesday, after March’s consumer price index exceeded economists’ expectations.
During Wednesday’s session, seven S&P 500 stocks hit their new 52-week lows.
— Pia Singh Real estate sector drops 4%, drags S&P 500 Real estate was the worst-performing sector in the S&P 500 during Wednesday’s session, shedding more than 4% during midday trading.
— Spencer Kimball Stocks open lower Wednesday Michael M. Santiago | Getty Images U.S. stocks started Wednesday’s trading session in the red.
The S&P 500 and Nasdaq Composite lost 1.2% and 1.3%, respectively.
— Hakyung Kim Tech stocks slump in premarket trading Shares of tech stocks slid in premarket trading Wednesday.
Futures tied to the S&P 500 and Nasdaq 100 futures each rose 0.1%, while Dow Jones Industrial Average futures ticked up 30 points, or nearly 0.1%.

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Michael M. Dotta | Getty Pictures.

Wednesday saw a catastrophic sell-off in stocks as March inflation data surprised analysts, possibly delaying the Federal Reserve’s much-anticipated rate cut.

A decrease of 519 points, or 1.3 percent, was seen in the Dow Jones Industrial Average. The Nasdaq Composite and SandP 500 both fell by 1%.

The broad market index showed red values for the entire day across all sectors. Real estate experienced a 4 percent decline, which led the day’s sector losses. The S&P 500 had a wild start to the year, rising 10 percent for its best first-quarter gain in five years, but had been essentially flat in April ahead of this inflation report.

Economists surveyed by Dow Jones predicted that the CPI would increase by 0 points4 percent in March and 3 points5 percent in the year over year, but the actual results were 0.5 percent for the month and 3.4 percent for the year. The core CPI, which does not include the volatile prices of food and energy, increased by 0.4 percent from the previous month and by 30.8 percent from a year ago; these figures were higher than the estimates of 0.3 percent and 3.7 percent, respectively. All items in the CPI increased in April at an annual pace of 3 1/2 percent.

According to the CME FedWatch Tool, data from Fed funds futures trading indicates that there is currently only a 20.6 percent chance that the Fed will cut rates at its June meeting. It’s currently the market consensus that the central bank’s September meeting will probably see the first rate cut.

In defiance of the Federal Reserve’s hope that inflation would return to its 2 percent target, the benchmark yield on mortgages and other debt, the 10-year Treasury note, surged back above 4 percent in March. This caused the yield on the 2-year Treasury to soar to almost 5%.

On fears that higher rates will start to suffocate the economy, bank shares, including JPMorgan Chase, and industrial shares, like Honeywell, fell 1% and 1.9 percent, respectively. Apple and Microsoft, two of the hottest tech stocks at the time, each took a 1% retreat. The benchmark small-cap Russell 2000 fell 2.6 percent.

In light of the recent string of higher-than-expected reports, Chris Zaccarelli, chief investment officer of Independent Advisor Alliance, stated, “It becomes more difficult for the Fed to advocate cutting rates any time soon.”.

The Wealth Alliance’s president and managing director, Eric Diton, claims that despite the markets’ ability to move past the volatile inflation data from January and February, indications of ongoing inflation are driving Wednesday’s decline.

As catalysts go, this one works just fine. The bull market is still going strong, in my opinion. However, I do believe it’s a justification for many people who have made significant gains to withhold some of those gains,” Diton remarked.

Investors are anticipating the meeting minutes from the Fed’s gathering last month in addition to the significant inflation report on Wednesday. Their goal will be to find out which policymakers have taken a stand on this year’s anticipated rate cuts. We’ll be releasing those at 2:00 p.m. m. EST.

New 52-week lows were reached by 7 S&P 500 stocks.

Wednesday saw a decline in the major stock averages as the consumer price index for March came in above forecast by economists.

Seven S&P 500 stocks made new 52-week lows on Wednesday during trading. The stocks that achieved this milestone are as follows:.

Charter Communications is trading at a level not seen since June of last year.

Starbucks is trading below where it was in November 2022.

Trading at levels not seen since March 2020, according to Brown-Forman.

At a level not seen since June 1998, Walgreens Boots Alliance is trading.

Biogen is trading at a low level not seen since September 2022.

Trading for Gilead Sciences is at a low not seen since October 2022.

Boeing is trading at a low it hasn’t been since December 2022.

Chris Hayes and Lisa Kailai Han.

Midday saw the biggest moves in the stocks of Cava, Nvidia, Deckers, Block, and other companies.

Edward Berthelot via Getty Images.

Take a look at the companies that are trending during midday trading.

Deckers Outdoor’s stock fell 6.9% after Truist downgraded the footwear company to hold due to concerns about a decline in demand for its core products. Truist also noted that Hoka’s direct-to-consumer trends had softened in February.

Cava — Shares jumped 4.4 percent after Argus upgraded the Mediterranean food chain to buy from hold, saying investors should buy the dip. According to the company, Cava has a “long runway to growth.”. Although shares have decreased 11% this month, they are still up 44% year to date.

Nvidia: As the “Magnificent Seven” leader attempted to escape correction territory, its shares increased by 1.7 percent. The stock is down 11% from its record highs set earlier in the year.

See this page for additional information.

— Singh Pia.

S&P 500 declines 4% as the real estate sector does.

With a loss of over 4 percent during midday trading on Wednesday, the S&P 500’s real estate sector was the worst-performing during the session.

With declines of more than 6% each, Extra Space Storage and Public Storage were the two largest laggards in the industry. A minimum of five percent declines were experienced by Prologis, Boston Properties, American Tower Corporation, and CoStar Group.

With a 1 percent decline, the shares of Host Hotels & Resorts saw the least amount of losses among the group.

— Subin Samantha.

Homebuilders decline in response to high inflation figures.

The iShares U. s. Home Construction ETF (ITB) dropped 3.4 percent on Wednesday in the wake of the CPI report for March, which was hotter than anticipated.

Trader expectations that the Federal Reserve would lower interest rates at its June meeting were dampened after the inflation data was released. Rate-sensitive homebuilding has been under pressure due to the possibility of “higher-for-longer” cost of borrowing.

– Kim Hakyung.

An economist warns that extended high interest rates could cause volatility in the currency markets.

Getty Images | Moment | Nora Carol Photography.

Investor expectations regarding the number of interest rate cuts this year from the Federal Reserve are being dampened by March’s inflation reading, which came in higher than anticipated. Chief economist Jeffrey Roach of LPL Financial believes that significant movements in the foreign exchange markets may result from the cost of borrowing being expected to remain higher for an extended period of time.

According to Roach, “investors are being warned by the gold market that inflation pressures may persist longer than the Federal Reserve would like.”.

The currency markets should be volatile, especially if the ECB lowers rates this summer and Japan intervenes with its currency, Roach continued, “should the Fed get backed into a corner and hold rates steady longer than expected.”.

– Kim Hakyung.

By reaching increasingly higher highs, Wall Street’s “fear index” predicts increased volatility in the future.

The Chicago Board Options Exchange Volatility Index, or VIX, is a gauge of investor apprehension and indicates that Wall Street anticipates more price swings in the days and weeks ahead than in previous years.

Known as the “fear index,” the VIX experienced an upward opening and was recently over 9 percent above Tuesday’s closing, having reached an intraday peak of 16 points 43. The intraday high of the VIX was actually above 16 on Wednesday for the fifth consecutive day. This level was last briefly attained on March 11, which was more than four weeks ago.

Back in early November and late October, as the current stock market rally was just getting started, the VIX was at levels higher than they are today. For instance, the intraday high of the VIX during the stock market selloff late last week was the highest since November 1, 2023.

Says Scott Schnipper.

Despite Wednesday’s selloff, Nvidia gains 1%.

In early morning trading, Nvidia shares saw a 1% increase, defying the general selloff trend.

Nvidia’s upward trend coincided with the major indexes entering a selloff phase and dropping more than one percent apiece. During the Wednesday session, Nvidia was the only one of the “Magnificent 7) stocks that was in the green. Tesla, which saw a roughly 3% decline, led the group lower.

— Subin Samantha.

Oil prices remain close to five-month highs following Israel’s threat to attack Iran.

Wednesday saw crude oil futures hover around five-month highs following Israel’s threat to attack Iran should the Islamic Republic launch a direct attack on Israel.

For May delivery, the West Texas Intermediate contract increased by 48 cents, or 0.56%, to $85.71 per barrel. At $89.90 a barrel, June Brent futures saw an increase of 48 cents, or 0.54%.

Israeli Foreign Minister Israel Katz posted on the social media platform X, tagging Supreme Leader Ayatollah Ali Khamenei, saying, “If Iran attacks from its territory, Israel will react and attack Iran.”.

Despite last week’s surge, investors booked profits, and oil prices haven’t dropped by more than 1% this week. U. s. As geopolitical tensions rise against the backdrop of a tightening global crude market, crude and the global benchmark have gained roughly 20 percent and 17 percent, respectively, this year.

Kimball, Spencer.

On Wednesday, stocks start the day lower.

Michael M. Dotta | Getty Pictures.

U. s. The trading session on Wednesday began with stocks declining.

400 points, or 1%, fell off the Dow. The S&P 500 and Nasdaq Composite experienced respective losses of 1.2 and 3.3 percent.

– Kim Hakyung.

Premarket trading for tech stocks is choppy.

Tech stock prices declined during Wednesday’s premarket trading. Google lost more than 0.5 percent, Microsoft lost more than 0.6 percent, Nvidia fell by 2 percent, and Meta also lost ground.

In the past year, these names have been among the best performers as investors snapped up shares of expensive tech stocks in the expectation that the Federal Reserve would start reducing interest rates, since rising rates are generally bad for tech stocks.

— Singh Pia.

Fears about interest rates cause industrial stocks to drop.

Picture Alliance | Getty Images / Klaus-Dietmar Gabbert.

Fears that higher interest rates for longer will slow down the economy caused shares of several cyclical and industrial names to drop.

In premarket trading, shares of Eaton, Deere, and Caterpillar all fell by roughly 2%.

Meanwhile, the Industrial Select Sector SPDR Fund , which tracks the sector, slipped 1.3 percent.

— Michelle Fox.

Premarket stock movements are the largest.

Look at a few of the companies that are generating news in the premarket trading.

The “Magnificent Seven” leader and artificial intelligence play, Nvidia, saw its stock fall by less than 1% prior to the opening bell, but on Tuesday it formally entered correction territory. At the closing price of $950 per share on March 25, shares had experienced a 10% decline.

Alibaba Group — Following media reports that co-founder Jack Ma praised the company’s management in an internal memo to staff, the China-based e-commerce company’s stock increased by almost 3%. The potential of AI was also discussed in Ma’s optimistic note.

Albemarle: With rising lithium prices, Bank of America upgraded the chemicals manufacturing company to buy and increased its price target, resulting in a roughly 2 percent increase in shares.

See the complete list by clicking this link.

— Evans Brian.

The CPI increased in March more than anticipated.

An important U. S. Fears that the Federal Reserve might not lower interest rates this year increased when the inflation metric showed higher than anticipated.

In comparison to February, the consumer price index increased by 0.4 percent in March. It increased by 3.5% annually. According to a Dow Jones survey, economists anticipated increases of 0.3 percent month over month and 3.4 percent annually.

Regaining momentum from February’s 3 point 2 percent increase was the CPI in March.

The core CPI increased more than anticipated last month as well, excluding volatile food and energy prices.

— Fred Imbert.

According to Bob Prince of Bridgewater, the Fed is “off track.”.

Bloomberg | Getty Images | Hollie Adams.

The persistent inflation and rapid growth in the U.S. economy may prevent the Federal Reserve from reducing interest rates as planned. s. The Financial Times was informed on Tuesday by Bob Prince, the co-chief investment officer at Bridgewater.

The Fed and the interest rate markets have not accurately predicted how this year will pan out thus far. It’s obvious, in my opinion, that the Fed is now off course. In the interview with the paper, he stated, “The question is how far off track.”.

Prince stated there was “no reason to move out of cash into longer-term bonds at the moment” because he believes rates will remain high for the foreseeable future. “.”.

To view the FT story, click this link.

Yun Li.

Aluminum hits its highest point in more than a year.

Getty Images | Andrey Rudakov | Bloomberg.

LME Aluminum reached its highest level since February on Wednesday morning, hitting 2,488 per metric ton. , 2023, reaching a peak price of $2,504 at that time.

As aluminum’s use in solar energy and wind turbines is predicted to increase, prices have increased due to ongoing supply concerns. US. s. Between 1999 and 2023, production decreased from 3 point 8 million metric tons to 785,000 tons.

Moreover, LME Tin hit a record high of $33,130 per metric ton, the highest since June. 16, 2022, when it traded as high as $33,400.

— Hakyung Kim.

Delta pops on strong earnings.

Delta shares were up more than 2 percent on the back of first-quarter earnings that beat analyst expectations.

The airline earned an adjusted 45 cents per share, topping an LSEG forecast of 36 cents per share. Revenue came in line at $12.56 billion. The company also reiterated its full-year earnings guidance.

Stock Chart IconStock chart icon.

— Fred Imbert.

Europe’s stocks begin trading higher.

European stocks opened higher Wednesday, with the Stoxx 600 index up 0.6 percent at 8:20 a. me. London time, with every sector displayed in green.

The DAX in Germany and the U.S. G. The FTSE 100 and France’s CAC 40 both experienced increases of approximately 0.6 percent.

Stock Chart Icon: Icon of a stock chart.

— Reid Jenni.

Fitch maintains its A+ rating while downgrading the outlook for China to “negative.”.

Because of “growing risks to China’s public finance outlook,” rating agency Fitch changed its assessment of the country from “stable” to “negative.”. “.”.

According to the agency’s report, the nation must move away from growth that is dependent on real estate and deal with more hazy economic prospects.

Furthermore, it pointed out that significant fiscal deficits and growing public debt in recent years have reduced fiscal buffers, and that debt may still rise in the years to come as fiscal policy plays a bigger and bigger role in promoting growth.

Fitch did, however, retain its A+ rating for China, noting a number of positive factors such as its sizable and diverse economy, strong GDP growth prospects in comparison to peers, and crucial role in the world’s goods trade.

— Jie Hui Hue.

Microsoft and NetEase are bringing games back to China.

Bringing back Blizzard Entertainment games to the second-largest economy in the world is a joint venture between Microsoft and NetEase, a massive Chinese internet technology company.

The action follows Blizzard’s 2023 termination of the two companies’ partnership, which was justified by a dispute over intellectual property ownership.

According to the press release, World of Warcraft and Overwatch are among the titles that Chinese players could access under the previous publishing agreement that will be included in the new one.

Additionally, Microsoft and NetEase have reached a deal to investigate the possibility of bringing new NetEase games to Xbox systems and other platforms.

Stock Chart Icon: Icon of a stock chart.

— Jie Hui Hui.

As predicted, Japan’s corporate inflation increased to 0.8 percent in March.

Japan’s corporate goods price index increased by 0.8 percent in March compared to the same month last year, which was faster than the revised 0.7 percent increase in February and in line with Reuters’ poll of economists.

Additionally, the corporate inflation rate has increased for three months running.

The CGPI increased by 0.2 percent month over month, which was marginally less than the 0.3 percent increase that Reuters had predicted.

The corporate sector’s price changes for goods are measured by the CGPI.

— Jie Hui Hui.

Among the stocks moving in extended trading are PriceSmart and WD-40.

Take a look at some of the names that are trending on Tuesday after hours trading.

Shares of PriceSmart increased 3.2 percent after exceeding second-quarter projections. The business that runs U.S. S. -style membership shopping warehouse clubs with $1 point31 in adjusted earnings per share on $1 point29 billion in revenue in Latin America and the Caribbean. In a FactSet survey, analysts projected $1.24 in earnings (excluding items) on $1.29 billion in revenue for the quarter.

After reporting second-quarter earnings of $284.08 million when FactSet’s poll of analysts had predicted $285.11 million, SMART Global Holdings’ shares fell 7. percent. In contrast to analysts surveyed by FactSet who predicted earnings of 25 cents per share, the memory and storage solutions provider reported earnings of 27 cents per share, excluding items.

Following the company’s failure to meet analysts’ second-quarter revenue projection, WD-40 shares saw a 0.5% decline. The company exceeded analysts’ estimates for quarterly revenue of $140 million in a FactSet survey, but it only reported $139 point1 million in earnings.

— Singh Pia.

Stock futures open in the green on Tuesday.

Getty Images / Michael M. Santiago.

Stock futures were slightly higher after 6 p. m. ET Tuesday evening. Futures tied to the S&P 500 and Nasdaq 100 futures each rose 0.1 percent, while Dow Jones Industrial Average futures ticked up 30 points, or nearly 0.1 percent.

— Pia Singh.

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