Live Stock Market News Updates: Stocks extended losses as inflation and interest rate concerns persist

Live Stock Market News Updates: Stocks extended losses as inflation and interest rate concerns persist

US stocks fell in early trading on Thursday as investors digested hot inflation data that showed price levels remained elevated in April, suggesting that more aggressive anti-inflation efforts by the Federal Reserve may be underway.

The Standard & Poor’s 500 Index plunged 1% after the index settled at 3,935.18, its lowest level since March 2021, in the previous session. The S&P 500 fell more than 17% in the first 90 trading days of 2022, marking its second worst start in a year, according to data from Compound Capital Advisors. The Dow Jones Industrial Average fell 250 points, or 0.8%, and the Nasdaq Composite Index fell 1.7%.

The moves were based on a series of sharp losses in stock markets and the track of the April Consumer Price Index (CPI) released on Wednesday, which showed an inflation rate that held near a 40-year high despite a marginal decline from the previous month. Moreover, the so-called core price index, which does not include volatile food and energy categories, came in higher than economists had expected, sparking fears among investors that higher prices may persist.

The April snapshot of inflation across the US comes as investors gauge the strength of the Federal Reserve’s intervention to rein in high price levels through monetary tightening, including interest rate increases. Uncertainty about the central bank’s next move sent turmoil across risk assets, sending the three major indices to year-to-date trading lows.

“Inflation appears to be entrenched in many areas of the economy, and regardless of whether we experience peak inflation, a continued slow decline will be more problematic for the Federal Reserve to cool inflation at the same time without pushing the economy into recession,” said Charlie Ripley, a The senior officials, an investment strategist at Allianz Investment Management, said in an email note on Wednesday.

Cleveland Fed President Loretta Meester told Yahoo Finance on Tuesday that a 50 basis point rate hike was likely at the next two Fed policy-setting meetings, while leaving a 75 basis point increase on the table as the central bank ramped up inflation. . Mitigation efforts.

“It’s going to be a challenge no doubt, because there are things going on on the supply side and on the demand side,” Meester said. “But inflation risks remain elevated and more dangerously high as we continue due to inflation expectations, so it’s really important that we commit to doing what we need to do.”

If inflation levels come out in the second half of the year, Peter Easley, head of portfolio management at the Commonwealth Financial Network, said there would be less pressure on the Fed to combat high price levels with aggressive monetary policies, “leaving open the possibility of a soft landing for the economy.” In exchange for crashing and burning those markets that were recently pricing them.”

“The second half of the year could be a strong period for stocks and bonds if inflation continues to moderate and the scale of interest rate hikes falls short of expectations,” Eisley said in a note. “Currently, investors are pricing in a doomsday scenario with inflation and are missing the forest for the trees.”

9:30 a.m. ET: S&P 500 down 1%, Dow Jones 250 points, Nasdaq down 1.7%

Here are the main moves in the market at the opening bell on Thursday:

  • Standard & Poor’s 500 (^ Salafist Group for Preaching and Combat): -31.73 (-0.81%) to 3,903.45

  • dow (^ DJI): -168.41 (-0.53%) to 31665.70

  • Nasdaq (^ ninth): -136.71 (-1.20%) to 11,227.52

  • raw (CL = F.): +0.10 dollars (+0.09%) to 105.81 dollars per barrel

  • He went (GC = F.): – $7.10 (-0.38%) to $1,846.60 per ounce

  • Treasury for 10 years (^ degeneration): -7.8 basis points to produce 2.8430%

9:15 a.m. ET: US producer prices extend their rally as inflationary pressures persist

Wholesale inflation rose again in April in a sign that the rise in consumer prices may last longer than expected.

The producer price index for final demand rose 11% from April last year and 0.5% month-on-month, driven by higher commodity costs, according to Labor Department data released Thursday. These numbers also follow notable upward revisions to the March numbers.

“Producer price inflation slowed slightly in April but remains historically high, with the Federal Reserve not raising interest rates in the April inflation numbers,” Bill Adams, chief economist at Bank of Comica, said in a note. “The Fed will want to see clearer evidence that inflation is cooling and that higher interest rates are slowing demand before they start thinking about the end point of the current rate-raising cycle.”

Core PPI, which excludes volatile food and energy components, rose 0.4% from the previous month and rose 8.8% from the same period last year. The gauge rose at a weaker-than-expected monthly pace but the March figure was revised upwards to 1.2% ahead of time.

9:07AM ET: New jobless claims rise unexpectedly but remain near the 200,000 . level

Claims for jobless filings rose for the first time unexpectedly in the latest weekly data but remained near their pre-pandemic lows, as a strong labor market and improving unemployment levels remain a bright spot in the US economy.

The Labor Department’s latest weekly jobless claims report showed 203,000 claims were filed in the week ending May 7, below expectations of the 192,000 economists surveyed by Bloomberg.

“It is unrealistic to expect the rate to drop well below 200,000,” Ted Rossman, chief industry analyst at Bankrate, said in a note. “Overall, the labor market remains an asset in an economy riddled with concerns about inflation, interest rate hikes, and more.”

Due to the rise and then the decline in unemployment claims, the Labor Department has now also reshaped the way it adjusts weekly data to take into account seasonal factors. Starting last week, the Labor Department reverted to using seasonal adjustment factors to “multiply” the data. For much of the pandemic, the administration has been using “extra” seasonal adjustments that help smooth out the big swings in the weekly numbers.

The 4-week moving average was 192.750, 4,250 more than the previous week’s revised average, according to a Department of Labor statement.

7:15 a.m. ET: Futures drop as selling continues amid inflation and interest rate concerns

Here are the key moves in early futures trading on Thursday before the market opens:

  • S&P 500 futures contracts (ES = F.): -16.00 (-0.41%) to 3914.25

  • Dow futures contractsYM = F.): -90.00 (-0.28%) to 31653.00

  • Nasdaq futures contractsNQ = F.): -90.25 (-0.75%) to 11879.50

  • raw (CL = F.):- $1.35 (-1.28%) to $104.36

  • He went (GC = F.): – $6.80 (-0.37%) to $1,846.90 per ounce

  • Treasury for 10 years (^ degeneration): 0.00 basis points to produce 2.9210%

6:30 a.m. ET: Instacart files for grocery delivery platform IPO

Instacart Inc. , the largest online grocery delivery service in the United States, has secret documents for an initial public offering, according to a Bloomberg News report.

The company is said to be working with banks including Goldman Sachs Group Inc. and JPMorgan Chase & Co. On the fly, according to Bloomberg, citing people familiar with the matter, who indicated that the listing could happen as soon as this year, although the timing could change.

Instacart, which has grown sharply during the pandemic as people switch to buying groceries online, recently saw a slowdown in growth after the COVID boom as consumers returned to in-person supermarket visits.

The company revealed in March that it had lowered its valuation by about 40% to $24 billion. Bloomberg reports that Instacart was previously valued at $39 billion in a March 2021 funding round from companies including Andreessen Horowitz, Sequoia Capital and D1 Capital Partners, as well as Fidelity Management & Research Co. and T. Rowe Price Associates Inc.

A smartphone with the Instacart logo displayed in this illustration taken on March 25, 2022. REUTERS / Dado Ruvic / Illustration

6:14pm ET Wednesday: Stock futures rise after losses in stocks continue

Here is where stock futures were in extended trading prior to Wednesday’s session:

  • S&P 500 futures contracts (ES = F.): +10.75 (+0.27%) to 3941.00

  • Dow futures contractsYM = F.): +76.00 (+0.24%) to 31819.00

  • Nasdaq futures contractsNQ = F.): +30.50 (+0.25%) to 12000.25

  • raw (CL = F.): + $0.02 (+0.02%) to $105.73

  • He went (GC = F.):- $1.90 (-0.10%) to $1851.80 per ounce

  • Treasury for 10 years (^ degeneration): -7.2 basis points to produce 2.9210%

A trader works at the NYSE Stock Exchange in New York, US, May 5, 2022. US stocks fell on Thursday as heavy selling intensified on Wall Street.  The Dow Jones Industrial Average fell 1,063.09 points, or 3.12 percent, to 32,997.97 points.  The Standard & Poor's 500 Index fell 153.30 points, or 3.56 percent, to 4,146.87 points.  The Nasdaq Composite Index, which was dominated by technology stocks, fell 647.17 points, or 4.99 percent, to 12,317.69 points.  (Photo by Michael Nagle/Xinhua via Getty Images)

A trader works at the NYSE Stock Exchange in New York, US, May 5, 2022. US stocks fell on Thursday as heavy selling intensified on Wall Street. The Dow Jones Industrial Average fell 1,063.09 points, or 3.12 percent, to 32,997.97 points. The Standard & Poor’s 500 Index fell 153.30 points, or 3.56 percent, to 4,146.87 points. The Nasdaq Composite Index, which was dominated by technology stocks, fell 647.17 points, or 4.99 percent, to 12,317.69 points. (Photo by Michael Nagle/Xinhua via Getty Images)

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter Tweet embed

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2022-05-12 11:17:12

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