Wall Street experienced a slight uptick Tuesday, as investors focused on upcoming US inflation statistics following an improved-than-expected Producer Price Index (PPI).
The Dow Jones Industrial Average rose 225 points (0.5%), while the S&P 500, Nasdaq Composite, and Nasdaq Composite each added 0.3%, and 0.1% respectively.
Palantir Technologies, Tesla, and Nvidia all posted positive returns of 2,9%, 1,8% and 1%, respectively.
Dow Jones polled economists and they predicted a 0.4% increase. The Bureau of Labor Statistics, however, reported that the PPI for December was only 0.2% higher. This is significantly lower than what Dow Jones had forecast.
The core PPI (which excludes volatile energy and food prices) remained unchanged.
The figures offered a small ray of hope to traders who hoped that the Federal Reserve was close to reaching its targets for inflation control.
The market participants await Wednesday’s Consumer Price Index (CPI), a crucial inflation indicator.
Analysts predict that the headline CPI will rise by 0.3% in December.
Sam Stovall is the chief investment strategist for CFRA Research. He warned that if CPI came in higher than expected it could be bad news to equity markets, as it might mean the Fed would not lower rates at all.
Fed futures indicate that it is almost certain the Federal Reserve Bank will maintain rates at their upcoming meeting.
According to CME FedWatch, current market prices indicate that 77.9% of the time the central bank is likely to maintain the target range between 4.25%-4.5% until March.
Earnings season begins with big banks
The fourth quarter earnings season will begin this week with the major banks.
JPMorgan Chase and Citigroup will report their results Wednesday. Goldman Sachs and Wells Fargo follow on Thursday. Morgan Stanley and Bank of America are scheduled to release theirs on the following day.
Sector Performance: Healthcare and utilities both perform well
Utilities were the leading sector on the stock market, gaining 1.4%. Vistra was the standout performer with a surge of over 5%. Constellation Energy also grew by 4%.
NRG Energy and AES Corporation (up 2%) were also notable winners. The industrial, financial and materials sectors all saw gains at least of 1.2%.
The S&P 500 fell 1.6% on the downside as healthcare stocks led the way.
Charles River Laboratories and Biogen both saw their shares fall by at least 3 percent.
Sector of communications services also fell, with a 1.2% decline, thanks to a 3.0% drop by Meta Platforms.
Nike’s three-year low
Nike’s shares fell 1.7% Tuesday to their lowest levels since March 2020.
Since Elliott Hill became CEO in October, the stock price has dropped 14%.
Investors remain cautious, but confident, about the market’s recovery. The tech and banking industries are in particular focus.
The post US Stocks Edge Higher as Traders Eye Inflation Data and Earning Season Kickoff may be updated as new developments unfold.
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