‘Vomit-inducing’ session ends with lower close for Dow, S&P 500, Nasdaq; CPI on tap

US stocks stumbled through an uncertain session on Wednesday, as investors digested the latest reading on wholesale inflation and more details about the Federal Reserve’s most recent interest-rate debates. The major US equity averages finished the session lower, with attention turning to the widely anticipated CPI report due out on Thursday.

The Dow (DJI) closed -0.1%the S&P 500 (SP500) ended -0.3% and the Nasdaq Composite (COMP.IND) finished -0.1%.

Looking at concluding numbers, the Dow Jones declined 28.34 points to close at 29,210.85. The S&P 500 fell 11.81 points to end at 3,577.03, while the Nasdaq slipped 9.09 points to finish at 10,417.10.

Seven of the 11 S&P sectors posted losses. Utilities led the retreat, dropping 3.4%. Real Estate was another standout decliner, slumping by 1.4%. No other market segment moved more than 1% in either direction.

With the mild declines, the S&P 500 and Nasdaq recorded their sixth consecutive session of losses.

“Viewed purely at the closing prices, the market today was merely killing time until the CPI catalyst Thursday. PPI data neither gee’d up nor demolished sentiment,” Alex King from Cestrian Capital Research told Seeking Alpha.

“For the moment – and the night is yet young – no G7 central banker has lobbed any thunderbolts about bond buying programs, another reason for what appears to have been a relatively quiet day,” King added, referring to the Bank of England’s recent policy shifts, which roiled markets on Tuesday.

Even recognizing Wednesday’s generally quiet action in the major averages, the Cestrian Capital Research analyst argued that this lackluster trading only masked “meaningful intraday swings in many individual stocks and ETFs.”

“AMD for instance has been down 2% and up 1%; and high-beta canary in the coalmine ARKK down close to 2% and up close to 2%,” he noted. “In short, a somewhat vomit-inducing day made to look dull by the close.”

Before the start of trading, the government released its latest read on wholesale inflation. The figures showed that September producer prices rose 0.4% from the previous month and 8.5% compared to the same time last year. Both these numbers came in above estimates. Meanwhile, core PPI matched projections with a 0.3% advance from the prior month.

“The headline was boosted by a surprisingly big 1.2% jump in food prices, which have been wild in recent months, and a 0.7% increase in energy prices, led by natural gas and fuel oil; gasoline prices fell,” Pantheon Macro said.

In the afternoon, the Federal Reserve released the minutes of its last policy meeting, which ended with another interest rate increase of 75 basis points. The document largely met expectations, with policymakers acknowledging that its hawkish stance will likely curtail economic activity but signaling that this was a necessary sacrifice to get inflation under control.

“[Fed officials] commented that recent inflation data generally had come in above expectations and that, correspondingly, inflation was declining more slowly than they had previously been anticipating, “the minutes said.

Following up on the PPI figures, Wall Street will receive the latest information on consumer inflation on Thursday morning. Generally viewed as the key data point for the week, investors are bracing for potential volatility if the CPI figure fails to match expectations.

Looking at Wednesday’s bond trading, rates were marginally lower. The 10-year Treasury yield (US10Y) dropped 4 basis points to reach 3.90%. Meanwhile, the 2-year yield (US2Y) declined 3 basis points to 4.29%.

Among active stocks, PepsiCo showed strength following the release of Street-beating quarterly results.

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