Stock lists on Wednesday saw shares rise after the release of better-than-expected April consumer price data. However, except for the Nasdaq, the indices finished mixed. The Dow Jones Industrial Average lost 0.22% to 33,487.87, the S&P 500 +0.24% to 4,129.20 and the Nasdaq 100 +1.04% to 12,306.44.
Treasury yields fell following the report, further supporting equity market concerns about the potential negative impact of rate hikes on economic growth. Notably, the 2-year Treasury yield fell 7.5 basis points to 3.949%, while the 10-year Treasury yield fell six basis points. As a result, tech companies like Alphabet, Nvidia, and Tesla have seen their stock prices rise.
On Thursday, May 11, investors remained uncertain about China’s growth after lifting the Covid-zero policy due to continued concerns over macro data. The Nikkei fell below par, while Hong Kong and Shanghai lost 0.45% and 0.2%, respectively.
Meanwhile, US oil WTI rallied 1% to $73.23 a barrel after the EIA report on US inventories. Wall Street futures, on the other hand, show an average of 0.2% positivity. A recent Reuters poll of 37 economists reveals that China’s April inflation is expected to fall to 0.3%.
The publication of the consumer price index is scheduled for Thursday. If forecasts prove correct, it would be the third consecutive month of decline in the index rate and the lowest reading since February 2021, when the index was at -0.2%. In March, China’s inflation stood at 0.7%, after a decline from its January peak of 2.1%.
Since the beginning of the week, traders have anxiously waited for crucial data that will influence the Federal Reserve’s subsequent decisions. These are mainly the April CPI report, released yesterday, and the producer price index, expected on Thursday. This information is essential in outlining the market’s future trajectory and substantially impacts future investment strategies.
In April, consumer prices recorded an increase of 4.9% compared to the same period of the previous year. The figure is slightly lower than the forecasts of economists polled by Dow Jones, which predicted a 5% increase. However, it lived up to expectations month-on-month, showing a 0.4% increase in April.
President Joe Biden met with House Speaker Kevin McCarthy on Tuesday afternoon. While both sides recalled that the meeting is primarily an occasion for dialogue, no significant progress has been made on raising the debt limit. The core of the disagreement lies in the House Speaker’s insistence that a deal on raising the debt ceiling is tied to spending cuts, a demand Biden opposes. The President has firmly stated that the increase in the debt ceiling is not negotiable.
Meanwhile, he continues the presentation of the companies’ quarterly earnings. Skyworks closed more than 5% lower on Tuesday after the release of its quarterly report before losing another 1.26% on Wednesday.
Conversely, Palantir soared 23% in share value on impressive financial results and optimistic projections, gaining 4.08% again Wednesday.
Shares of PayPaldow fell after the release of its recent earnings report on Monday. However, the earnings report beat analyst expectations, with earnings per share up 33% to $1.17 and revenue up 9% to $7.04 billion. The total volume of payments processed by commercial customers also increased 10% to $354.5 billion, beating Wall Street forecasts.
Despite raising its adjusted earnings growth forecast to $4.95 per share, or 20 percent growth, PayPal lowered its margin forecast. This led to a drop in the share price, which finished the session down 12.7% on Tuesday and a further -3.83% on Wednesday. Currently, PYPL has lost nearly 16% of its value this year.
Goldman Sachs (GS) shares ended the trading day down 0.68%. The company recently agreed to pay $215 million to settle a gender discrimination lawsuit. Under the terms of the agreement, the bank hires an impartial expert to conduct further research on pay equity.
Wednesday price lists on May 10
The DOW Jones -0.22% at 33,487.87
The S&P 500 was up +0.24% at 4,129.20
The NASDAQ 100 was up +1.04% at 12,306.44
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