S&P 500, Nasdaq hit record highs at open on September rate cut hopes
The
Dow
Jones Industrial Average rose 112.9 points, or 0.25%, at the open to 44571.53. The S&P 500 rose 16.9 points, or 0.26%, to 6462.67, while the Nasdaq Composite rose 82.6 points, or 0.38%, to 21764.548.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Time of India
42 minutes ago
- Time of India
PPI inflation shock rocks Wall Street and Trump — big Fed rate cut dreams go up in smoke
U.S. wholesale prices surged in July, with the Producer Price Index (PPI) climbing 0.9%, marking the fastest monthly increase since May 2022. Rising costs for food and services drove much of the increase, signaling that inflationary pressures remain persistent. Core PPI, which strips out volatile food and energy costs, rose 0.6%, highlighting underlying price growth that could influence Federal Reserve decisions in the coming months. At the same time, jobless claims eased slightly to 224,000 from 227,000 the previous week, showing that the labor market remains relatively strong but may be starting to soften. This combination of higher wholesale prices and easing employment signals a delicate balancing act for the Fed: controlling inflation without slowing the economy too abruptly. Investors reacted cautiously to the data. S&P 500 futures fell 0.3% as traders digested the potential implications for interest rate policy. Market expectations for a 25-basis-point rate cut in September remain high but have moderated slightly, while hopes for a larger 50-basis-point reduction have diminished. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Dementia and Memory Issues Have Been Linked To a Common Habit. Do You Do It? Memory Research Click Here Undo For everyday Americans, rising wholesale prices often translate into higher costs for goods and services, from groceries to household essentials. Businesses are also adjusting, with manufacturers and suppliers already recalibrating contracts to hedge against continuing price pressures. Producer Price Index (PPI) – July 2025 Monthly change: +0.9% (largest monthly rise since May 2022) Annual change: +3.3% (up from 2.4% in June) Goods prices: +0.7% (food, durable goods lead increase) Services prices: +1.1% (largest contributor to overall rise) Live Events July's PPI shows sharper inflation pressures than expected Wholesale prices surged in July, with the Producer Price Index (PPI) climbing 0.9% month-over-month — the largest increase since May 2022. Goods prices rose 0.7%, led by food and durable goods, while services jumped 1.1%. On an annual basis, PPI inflation accelerated to 3.3% from June's 2.4%, surpassing most economists' forecasts. Excluding volatile food and energy costs, core PPI jumped 0.6% in July, marking its steepest monthly rise in three and a half years. The annualized core rate now sits at 2.8%. For context, this core reading is critical because it reflects underlying inflation trends that most directly influence Federal Reserve policy. Core PPI (Excluding Food and Energy) Monthly change: +0.6% (largest monthly gain in 3.5 years) Annual change: +2.8% What rising PPI means for businesses and consumers? Wholesale price inflation often filters down to retail prices, impacting everything from groceries to housing costs. Companies facing higher input costs may pass them to consumers, fueling further price pressures. For households, even moderate increases in the PPI can translate to noticeable jumps in daily spending, particularly in food and energy. First-hand insights from industry sources indicate that manufacturers in the Midwest are already recalibrating supply contracts to hedge against rising costs. One executive in Chicago's food processing sector noted, 'We're seeing supplier prices move faster than our forecasts. Some of that will inevitably hit store shelves by early fall.' Jobless claims suggest labor market is easing Contrasting with inflation pressures, initial unemployment claims dropped slightly to 224,000 from 227,000 the previous week. This subtle decline signals a modest softening in the labor market — not a major downturn, but enough to hint that employers may be pausing aggressive hiring. Historically, a stable or slightly easing job market can balance inflationary pressures, giving the Fed more flexibility to moderate policy without derailing growth. Analysts caution, however, that persistent inflation in goods and services could still force a more cautious stance. Jobless Claims Initial claims: 224,000 (down from 227,000 previous week) Implication: Slight labor market softening; not a major downturn How markets reacted to the data? Following the PPI release, S&P 500 futures dipped roughly 0.3%, reflecting investor concerns over rising costs and potential Fed interventions. Markets are still pricing in a 94.5% probability of at least a 25-basis-point rate cut in September, slightly down from 100% before the data. Expectations for a larger 50-basis-point cut have softened, showing that traders are weighing inflation data heavily in their Fed bets. Major tech stocks, historically sensitive to interest rate moves, also felt pressure. Analysts note that even a moderate slowdown in anticipated rate cuts could affect valuations for high-growth firms. Market Reaction S&P 500 futures: Fell by 0.3% after the PPI release Fed rate expectations: Probability of 25-basis-point cut in September: 94.5% (down from 100% pre-data) Probability of 50-basis-point cut: Lower than prior expectations What this means for the Federal Reserve? The Fed faces a delicate balancing act: strong inflation signals suggest caution, while a gradually cooling labor market argues for support. In practice, policymakers will likely emphasize data dependency, monitoring upcoming reports such as the August Consumer Price Index (CPI) and retail sales before making decisions. Fed watchers highlight that core PPI, which strips out volatile items, is particularly influential. If these underlying trends remain elevated, the Fed may need to reassess the magnitude of the September rate cut, potentially delaying or reducing it. Implications for investors and consumers For investors, rising wholesale costs may shift portfolios toward inflation-resistant sectors, such as commodities, utilities, or dividend-paying stocks. Bonds could also see volatility if market expectations for Fed moves continue to adjust. Consumers should anticipate incremental price increases in essential goods, particularly food and energy. Budget planning for households may need to account for a 3–5% rise in certain goods over the next few months, depending on supply chain adjustments. July's PPI and jobless claims provide a snapshot of the economic balancing act facing the U.S.: inflation pressures remain, but the labor market shows signs of moderation. The next few weeks of economic data will be crucial in shaping the Fed's September policy and market sentiment. Investors, businesses, and households alike are advised to watch for signals from upcoming CPI readings, retail sales reports, and corporate earnings updates. FAQs: Q1: What caused U.S. wholesale inflation to rise in July? July's PPI jump was driven by higher food and service costs, pushing inflation above expectations. Q2: How did jobless claims affect market outlook in July? Falling jobless claims signaled slight labor market easing, influencing S&P 500 futures and Fed rate expectations.
Time of India
43 minutes ago
- Time of India
US market today: S&P 500, Nasdaq slip from peaks; Dow down 104 points after hot inflation data
Photo credit- AP Wall Street retreated from record levels on Thursday after US government data showed wholesale inflation rose more than expected last month, dimming hopes for imminent interest rate cuts. The S&P 500 slipped 0.2% from its all-time high set on Wednesday, while the Dow Jones Industrial Average fell 104 points, or 0.2%, and the Nasdaq composite eased 0.1% from its record in early trading, AP reported. The US Labor Department reported that prices at the wholesale level jumped 3.3% year-on-year in July, sharply higher than economists' forecast of 2.5%. Analysts warned the increase could signal higher consumer prices ahead as costs filter through the economy. The hotter-than-expected data prompted traders to reassess expectations for a September interest rate cut by the Federal Reserve. CME Group data showed a 5% probability the Fed could keep rates unchanged next month, compared to near-certainty of a cut a day earlier. 'This doesn't slam the door on a September rate cut,' said Chris Larkin, managing director, trading and investing, at E-Trade from Morgan Stanley. 'But it may raise a bit of doubt.' by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Got Knee Pain? Treatment in Khilgaon Might Surprise You Knee Pain Treatment | Search Ads Undo The inflation reading came after a more encouraging consumer price update earlier in the week. Separately, weekly jobless claims fell, signalling layoffs remain low despite tighter job openings. A resilient labour market could also give the Fed less incentive to cut rates in the short term. Treasury yields rose after the data, with the 10-year yield climbing to 4.26% from 4.20%. On the corporate front, Tapestry slumped 16.9% after the Coach and Kate Spade parent warned tariffs and duties could shave $160 million off annual profit. The company's profit outlook missed estimates, even as revenue guidance exceeded expectations. Deere fell 8% after cutting the top end of its full-year profit forecast, citing cautious customer sentiment amid uncertainty. Overseas, stock market performance was mixed across Asia and Europe ahead of Friday's meeting between US President Donald Trump and Russian President Vladimir Putin. Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
Hindustan Times
an hour ago
- Hindustan Times
S&P Global upgrades India investment rating: What about the Trump tariff effect?
S&P Global Ratings on Thursday bumped up India's investment grade rating, indicating that the economy's growth prospects won't be derailed by the US President Donald Trump administration's 50 per cent tariff shock. India's ratings upgrade comes days after Donald Trump imposed an additional 25 percent tariff due to Russian oil purchases amid Moscow's war in Ukraine.(Representational) According to a statement from S&P, India's credit rating has been upgraded to BBB from BBB-, with a stable outlook. The bump places India in the same rating category as countries like Mexico, Indonesia, and Greece. The ratings reflect India's stronger economic fundamentals, S&P (previously Standard and Poor's) said. 'The upgrade of India reflects its buoyant economic growth, against the backdrop of an enhanced monetary policy environment that anchors inflationary expectations. Together with the government's commitment to fiscal consolidation and efforts to improve spending quality, we believe these factors have coalesced to benefit credit metrics,' S&P said in the statement. The upgrade comes days after Donald Trump imposed an additional 25 per cent tariff due to Russian oil purchases amid Moscow's war in Ukraine. The total tariff now stands at 50 per cent. According to an estimate by Bloomberg Economics, India's exports to the US could drop by 60 per cent if the tariffs remain in place, putting nearly 1 percent of its gross domestic product at risk. S&P, however, said the economic impact will be 'manageable' as 60 per cent of India's growth is driven by domestic consumption. While the US tariffs 'may eventually result in a one-off hit to growth, we envisage the overall impact to be marginal and will not derail India's long-term growth prospects,' the statement said. India's sovereign 10-year bonds rallied, with yields falling as much as 10 basis points to 6.38 percent following the announcement. The rupee also rallied after the announcement. S&P's growth forecast for India S&P Global Ratings expects India's GDP to grow at an annual rate of 6.8 percent over the next three years. By contrast, the Reserve Bank of India (RBI) last week projected 6.5 percent growth for the current fiscal year, with governor Sanjay Malhotra adding that the country should aspire to a higher growth trajectory. The union government welcomed the S&P's decision to upgrade ratings. 'India's prioritising of fiscal consolidation, while maintaining its strong infrastructure drive and inclusive growth approach, has led to the upgrade,' the Department of Economic Affairs Secretary Anuradha Thakur said in a statement.
