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U.S. stocks are rising after cooler-than-expected inflation stokes rate hopes

Published 07/12/2023, 10:26 AM
Updated 07/12/2023, 11:13 AM
© Reuters.

Investing.com -- U.S. stocks jumped after a cooler-than-expected inflation report for June revived hopes the Federal Reserve was nearing the end of its interest rate increases.

At 11:12 ET (15:12 GMT), the Dow Jones Industrial Average was up 265 points or 0.8%, while the S&P 500 was up 0.9% and the NASDAQ Composite was up 1.2%.

June inflation stokes hopes for end to rate hikes

Consumer prices cooled in June, raising hopes that the Federal Reserve would reach the end of its rate hikes sooner rather than later. It is still expected to raise them by another quarter of a percentage point when it meets later in July.

Headline and core inflation in the U.S. rose at a slower-than-expected pace last month. The Bureau of Labor Statistics said the consumer price index increased 3.0% annually, down from 4.0% in May. Economists had forecast a rise of 3.1%.

It was the lowest level in more than two years and represented a steep deceleration from 9.1% last June.

For the month, CPI rose 0.2%, up from 0.1% in the prior month. Estimates had called for 0.3%.

Coming up: Beige Book and producer prices

The cooler reading stoked hopes the rate hikes could end soon. The Dow is already on pace for its best week since March.

Another closely watched reading – producer prices – is due out Thursday morning.

Later today, the Fed will release its Beige Book, which is a periodic survey of its district banks. The report helps break down economic and financial trends being observed throughout the country.

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Microsoft jumps after Activision deal go-ahead

Microsoft Corporation (NASDAQ:MSFT) shares were up 1.9% after a federal judge cleared the way for it to close its acquisition of Activision Blizzard (NASDAQ:ATVI) as early as next week. Federal competition regulators had tried to block the deal on antitrust grounds.

Bank stocks are the headline earnings this week, kicking the season off on Friday with reports from JPMorgan (NYSE:JPM), Citigroup (NYSE:C), and Wells Fargo (NYSE:WFC). JPMorgan was up 1.1% in Wednesday trading. Analysts are listening to what executives say about business and consumer spending trends.

Latest comments

Largest stock market bubble in history. 15 year parabolic rise. Inflation coming down because economy slowing, corporate earnings will reflect that. Only fools would be piling into stocks at these levels.
"Largest stock market bubble in history"  --  No, esp. not with S&P 500 6% below high.
Did you spend the last 15 years in a cave?
America are stupid
So's your grammar.
Numbers are lies.Go do some shopping in California. Toast prices at local supermarket have risen 20% so far this year. Utility prices have risen 10% so far this year. The list goes on and on.
Dollar Tree Mr. Toast n Margarine
  I wouldn't mind high inflation rate for trans fat ... it'll bring down healthcare costs!  ;-)
Nahhh, they always find a way to bill endless procedures.. Current health insurance structure is the problem..
"Cooler than expected inflation," what a joke.  And of course this wasn't "priced in" with the last two criminally manufactured "rallies."  BIGGEST INVESTMENT JOKE IN THE WORLD.
Big ones bought back commodities small caps & Reite never benn so easy lol
learn how to trade tool bag
Jerome said months ago 5.75 eoy
these forecasts of 3.5 % around CPI for may june and july were well known 4 or 5 months ago. Hence loads of money went into global equities buying right from march to april and i have mentioned this way back in april too - and also using technicals like elliott wave patterns in some of the articles under comments section that SP from 3800 can reach 4600 + and even 5000 this year
what about the inflation in the stock market?
  "Wise perma-bears"?  That's an oxymoron.  "when they are cheap" I call for buy the dip, I call the bears who were not perma wise and those who were perma  broken clocks.  So unfortunate that you've gleaned no wisdom from me  ;-(
  "wise perma-bears"?  That's an oxymoron.  "when they are cheap" I call for buy the dip, I call the bears who were not perma wise and those who were perma  broken clocks.  So unfortunate that you've gleaned no wisdom from me  ;-(
  "wise perma-bears"?  That's an oxymoron.  "when they are cheap" I call for buy the dip, I call the bears who were not perma wise and those who were perma  broken clocks.  So unfortunate that you've gleaned no wisdom from me  ;-(
thanks 😊
USA dollar and Global economy are in shambles. Bulls 🐂 🐂 soon to follow. U Kno. Global Depression before the next election. 👀🐻‍❄️🍒😉🍺😎
  I don't even read MSM, but you do.
  The propaganda from conspiracy/retrumplican/Kremlin/CCP sites are forms of groupthink, fyi.
  Also, fyi, when a large group of people think alike on something and they're correct, that's NOT groupthink.
Stock valuations continue their meteoric rise.
The new bull market must be starting now.
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