Today, the main stock indices returned to decline Wall Street, with the S&P 500 and Dow Jones pulling back from their all-time highs as new data showed that inflation did not decline as much as expected.
Stronger-than-expected inflation data and a surge in jobless claims last week have fueled discussions about whether the Fed will opt for a smaller rate cut next month or pause after its big 50 basis point cut. in September.
THE S&P 500 fell 0.21%, closing at 5,780.05 units, while the Dow Jones Index ended at 42,454.12 points, a drop of 0.14%. THE Nasdaq fell marginally by 0.05% to 18,282.05 points.
“Sentiment was boosted today by consumer price data. There were no major surprises, but some components were above expectations. Investors mostly liquidated small and mid-cap stocks that are more sensitive to the path of interest rates.
OR Wall Street he “digested” the data on consumer prices, which rose 0.2% month-on-month, raising annual inflation to 2.4% from the 2.3% expected by analysts and 0.1% month-on-month previous. But again, this is the smallest increase since February 2021.
Shortly after the data was released, Atlanta Regional Reserve Bank Governor Rafael Bostick said he preferred to hold rates at the November meeting rather than cut them. “Stubborn inflation tells me we better take a break in November. He’s completely open to that possibility,” he told the WSJ.
Concerns are already growing that the Federal Reserve may slow the pace of the future tapering. After all, the minutes of the last Fed meeting showed that there are some differences among policymakers on the extent of the rate cuts, with some wanting a smaller cut of 25 basis points.
Among individual stocks, Universal Insurance gained 10% when Hurricane Milton hit Florida. Meanwhile, Pfizer fell 2% after activist investor Starboard Value accused the drugmaker of threatening to sue two of its former top executives.