July 25, 2024

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Wall Street is heading for an unchanged open after disappointing inflation numbers

Wall Street is heading for an unchanged open after disappointing inflation numbers

(APMF IN-DOW JONES) US stock markets are expected to open flat on Tuesday, after a disappointing release on producer prices.

Before the opening bell in New York, S&P 500 futures fell 0.1 percent.

In a double ticker on Tuesday and Wednesday, US producer prices were announced for the first time today and rose faster than expected. Producer prices rose 0.5% month-on-month, after a revised 0.1% decline in March. Economists expect an increase of 0.3 percent for April. Excluding volatile trade, food and energy prices, US producer prices rose 0.4 percent last month, following a 0.2 percent increase in core prices in March.

On an annual basis, producer prices rose 2.2 percent in April, and core prices rose 3.1 percent. In March this was 1.8 and 2.8 percent.

Producer prices are often a few months ahead of the development of consumer prices, which are scheduled to occur tomorrow. Here the market takes into account an increase of 0.4 percent on a monthly basis, and an increase of 3.4 percent on a yearly basis.

Today there is also a speech by Jerome Powell on the agenda. Powell visits Amsterdam and meets with Claes Knot, President of the Dutch Central Bank. Perhaps Powell can shed more light on recent developments.

Investors will closely monitor developments between China and the United States. Today, Washington quadrupled the customs tariff on imports of Chinese electric cars, from 25 to 100 percent. Tighter tariffs have also been imposed on other Chinese products. This step was not surprising. The market was expecting tightening for several days in the period leading up to the US presidential elections.

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Biden will next compete against former President Donald Trump, who also imposed significant tariffs on imports from China during his presidency.

According to Frank Franken of Edmond de Rothschild Bank, investors do not have to wait for Trump’s possible re-election before starting a renewed trade war between the US and China.

He said, “The question is how will Beijing respond? Escalation based on the principle of an eye for an eye will not benefit the global economy. The decline in global trade will of course have consequences for global growth, there is no doubt about that.” Market expert Edmond de Rothschild Bank on Monday in a preview of Biden’s expected announcement.

Oil prices fell after these numbers, as the price of a barrel of West Texas Intermediate crude fell by 0.6% to $78.66.

Interest rates rose slightly after the inflation numbers. The yield on US ten-year bonds reached 4.48 and the euro/dollar rose slightly to 1.0809.

Company news

Home Depot shares fell slightly before the market closed after the quarterly numbers were announced. The do-it-yourself chain’s turnover and profits were under pressure, but earnings per share were higher than expected. Expectations were also maintained.

Digital news channel BuzzFeed reported a quarterly loss and 18 percent drop in revenue Monday evening. Shares fell nearly 12 percent before the opening bell.

The resurgence of meme stocks continued Monday in pre-market trading. GameStop shares rose about 133 percent and AMC shares rose more than 123 percent. Other stocks that were frequently shorted also found their way higher, resulting in significant losses in selling prices.

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SunPower, one of the most shorted stocks on Wall Street, saw its price rise 19.6 percent on Monday. Another 121 percent was added on Tuesday.

Shares of MicroCloud Hologram, also known for shorts, rose 18 percent on Monday and another 77 percent on Tuesday.

Wall Street closing positions

The Standard & Poor’s 500 index fell slightly to 5,221.42 points on Monday, the Dow Jones lost 0.2 percent to 39,431.51 points and the Nasdaq closed up 0.3 percent to 16,388.24 points.

Source: ABM Financial News

ABM Financial News is a resource for stock market news, video and data, both for real-time trading platforms and trading rooms and for online and offline media publications. The information in this article is not intended to provide professional investment advice or a recommendation to make particular investments.