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Business Insider
4 days ago
- Business
- Business Insider
Why the latest inflation report is a best-case scenario for the stock market
The stock market is rallying on the latest inflation report. The S&P 500 hit an intraday record of 6,428.78 following the report, while the Nasdaq rose nearly 1% and the Dow spiked more than 400 points. The benchmark S&P 500 is up more than 9% year-to-date. Here's where US indexes stood around 11:20 am ET on Tuesday. The consumer price index rose 2.7% year-over-year in July, slightly below economists' expectations of 2.8%. For investors, this was just right — not too hot, not too cold. That's mainly because it was likely low enough to allow the Federal Reserve to cut rates at its September meeting, traditionally a bull catalyst for stocks. The CME FedWatch Tool now shows markets seeing 92% odds the Fed cuts rates by 25 basis points next month, up from about 80% on Monday. Higher odds are also being priced in for a cut in October and December following Tuesday's CPI release. "Tuesday's CPI data was tame enough that it gives the Federal Reserve the green light to cut rates by at least 25 basis points in September and opens the possibility of a larger 50 basis point cut in September," said Skyler Weinand, chief investment officer at Regan Capital, on Tuesday. "This data, coupled with the weak July employment report from earlier this month, puts the nail in the coffin for lower interest rates." Investors had been waiting for more insight into how higher tariffs would affect inflation data, and the July number shows the impact has not been severe, at least for now. To be sure, with many deadlines for tariffs set for August, the impact on inflation could be more pronounced in the coming months. But for now, the market is cheering higher rate-cut odds for September and a lower likelihood of the economy's most dreaded scenario—stagflation—when inflation surges while economic activity stalls. On the flip side, inflation was high enough to signal that consumer demand is strong enough to continue to support price growth. The July payrolls report, which saw massive downward revisions to June and May data, had fueled fears that a potential recession was underway. Trump fired Bureau of Labor Statistics director Erika McEntarfer after the report was released. While July's inflation data was satisfactory for investors, the Fed isn't out of the woods yet on inflation, and further rate cuts after September are not guaranteed, said Seema Shah, chief global strategist at Principal Asset Management. "The concern for the Fed is that with inventory run-down, the tariff-induced boost to inflation is likely to grow over the coming months, meaning that inflationary pressures are likely to pick up just as the Fed starts to resume rate cuts," Shah said in an email Tuesday. "Markets like today's inflation print as it means the Fed can lower rates unheeded next month — rate cut decisions in October, December and beyond may well be more complicated." Trump blasts Powell again President Trump weighed in on the July inflation numbers in a Truth Social post on Tuesday morning, again urging Fed Chair Jerome Powell to slash rates. "Jerome 'Too Late' Powell must NOW lower the rate. Steve 'Manouychin' really gave me a 'beauty' when he pushed this loser. The damage he has done by always being Too Late is incalculable," Trump wrote. "Fortunately, the economy is sooo good that we've blown through Powell and the complacent Board. I am, though, considering allowing a major lawsuit against Powell to proceed because of the horrible, and grossly incompetent, job he has done in managing the construction of the Fed Buildings," he continued. "Three Billion Dollars for a job that should have been a $50 Million Dollar fix up. Not good!"
The Star
15-07-2025
- Business
- The Star
U.S. stocks close mixed after June CPI report
NEW YORK, July 15 (Xinhua) -- U.S. stocks ended mixed on Tuesday as investors digested fresh inflation data and a wave of earnings reports from major financial institutions. The Dow Jones Industrial Average dropped 436.36 points, or 0.98 percent, to close at 44,023.29. The S&P 500 fell 24.8 points, or 0.4 percent, to 6,243.76. In contrast, the Nasdaq Composite rose 37.47 points, or 0.18 percent, to 20,677.8, marking a new all-time closing high. Ten of the 11 primary S&P 500 sectors closed in the red. Materials and health care were the biggest decliners, falling 2.11 percent and 1.88 percent, respectively. Technology was the only sector to finish higher, gaining 1.27 percent. June's inflation data, released Tuesday, showed consumer prices rising 0.3 percent for the month, in line with expectations and up from May's pace. The annual CPI rate stood at 2.7 percent. Core CPI, which strips out food and energy, climbed 0.2 percent from the previous month and 2.9 percent year over year, both matching analysts' forecasts. Skyler Weinand, chief investment officer at Regan Capital, said it was a relief to see Tuesday's CPI report come in line with expectations, but "it's highly likely that a tariff-driven inflation reckoning is coming." "The latest U.S. inflation report practically confirmed that President Trump's tariffs acted to push up consumer prices in June," said Matthew Ryan, head of market strategy at global financial services firm Ebuy. On the earnings front, several major banks delivered underwhelming results. Wells Fargo beat profit expectations but issued lower guidance for net interest income, pushing its shares down more than 5 percent. JPMorgan Chase also posted strong results but saw its shares slip. BlackRock dropped 5.88 percent after missing revenue estimates. Citigroup stood out, gaining 3.68 percent after beating second-quarter earnings expectations. In the tech sector, Nvidia surged 4.04 percent after announcing it would resume shipments of its H20 AI chips to China, following White House assurances that current export restrictions would be eased. The news sparked a rally in semiconductor stocks. Advanced Micro Devices (AMD) rose 6.41 percent, Arm Holdings and Broadcom each added less than 2 percent, and the iShares Semiconductor ETF climbed 1 percent. Among other mega-cap tech names, Alphabet, Microsoft, Apple and Amazon posted modest advances. Tesla declined 1.93 percent, and Meta Platforms lost 1.46 percent.
CNBC
15-07-2025
- Business
- CNBC
Verizon, MSGS stocks may be tariff-proof, says Regan Capital's Weinand
CNBC's "Power Lunch" team discusses what stocks may be immune to tariffs with Skyler Weinand, chief investment officer at Regan Capital.
Yahoo
04-06-2025
- Business
- Yahoo
Wall Street ends narrowly mixed on weak economic data
STORY: U.S. stocks ended mixed on Wednesday, with the Dow dropping about two-tenths of a percent, the S&P 500 finishing flat and the Nasdaq ticking up about three-tenths of a percent. Investors were focused on tariff negotiations, with President Donald Trump and Chinese leader Xi Jinping expected to speak sometime this week. Wednesday was President Trump's deadline for trading partners to make their best offers to keep further tariffs from taking effect in early July. But Regan Capital's chief investment officer Skyler Weinand says a resolution to trade uncertainty could still be a ways off. "Well, we've got about three-and-a-half years left in in this administration. We got about a year-and-a-half until the midterms. We really won't see any true resolution until one of those two at least take place, at least until the midterms. [FLASH] And China is playing a game of centuries where they are, you know... when you look at auto manufacturing for example, China spent something like $280 billion bolstering auto manufacturing. They've been playing this game for a long time of onshoring. And the United States is just getting to play this game of onshoring, and onshoring is going to take 5 to 10 years." Early stock market gains on Wednesday evaporated later in the session as weak data for May revealed the toll President Trump's erratic trade policies have taken on the U.S. economy. Last month, the services sector contracted for the first time in nearly a year and the ADP National Employment Report showed U.S. private employers added the fewest number of workers in more than two years. Stocks on the move Wednesday included Tesla, which fell 3.5% as the electric-vehicle maker's sales dropped for the fifth straight month in big European markets. Shares of Meta Platforms jumped more than 3% after JPMorgan raised its price target on the stock. And shares of Hewlett Packard Enterprise rose after the company reported second-quarter revenue and profit that beat estimates, driven by demand for its artificial-intelligence servers and hybrid cloud segment. Sign in to access your portfolio
Yahoo
04-06-2025
- Business
- Yahoo
Wall Street ends narrowly mixed on weak economic data
STORY: U.S. stocks ended mixed on Wednesday, with the Dow dropping about two-tenths of a percent, the S&P 500 finishing flat and the Nasdaq ticking up about three-tenths of a percent. Investors were focused on tariff negotiations, with President Donald Trump and Chinese leader Xi Jinping expected to speak sometime this week. Wednesday was President Trump's deadline for trading partners to make their best offers to keep further tariffs from taking effect in early July. But Regan Capital's chief investment officer Skyler Weinand says a resolution to trade uncertainty could still be a ways off. "Well, we've got about three-and-a-half years left in in this administration. We got about a year-and-a-half until the midterms. We really won't see any true resolution until one of those two at least take place, at least until the midterms. [FLASH] And China is playing a game of centuries where they are, you know... when you look at auto manufacturing for example, China spent something like $280 billion bolstering auto manufacturing. They've been playing this game for a long time of onshoring. And the United States is just getting to play this game of onshoring, and onshoring is going to take 5 to 10 years." Early stock market gains on Wednesday evaporated later in the session as weak data for May revealed the toll President Trump's erratic trade policies have taken on the U.S. economy. Last month, the services sector contracted for the first time in nearly a year and the ADP National Employment Report showed U.S. private employers added the fewest number of workers in more than two years. Stocks on the move Wednesday included Tesla, which fell 3.5% as the electric-vehicle maker's sales dropped for the fifth straight month in big European markets. Shares of Meta Platforms jumped more than 3% after JPMorgan raised its price target on the stock. And shares of Hewlett Packard Enterprise rose after the company reported second-quarter revenue and profit that beat estimates, driven by demand for its artificial-intelligence servers and hybrid cloud segment.
