U.S. stock futures were lower Wednesday as Wall Street anxiously awaited the latest consumer price index (CPI) data for insights on the pace of inflation. Futures tied to the Dow Jones Industrial Average slipped 68 points, or 0.1%. The S&P 500 futures fell by 0.2%, and Nasdaq-100 futures ticked down 0.1%.
The major averages declined during Tuesday’s session as the market took a breather from its post-election rally. The Dow fell around 382 points, or 0.9%, the S&P 500 declined 0.3%, while the tech-heavy Nasdaq inched down 0.1%. Tom Hainlin, senior investment strategist at U.S. Bank Wealth Management, said “Part of the market decline Tuesday is just a little bit of profit-taking based on the strong gains – especially post-election – and some positioning ahead of tomorrow’s inflation report and Friday’s retail sales report.
Investors are keenly focused on October’s CPI numbers, scheduled for release Wednesday morning, to assess how much the costs of goods and services have risen.
Economists surveyed by Dow Jones expect the CPI to increase by 0.2% for the month and 2.6% year over year. The pace of price increases is also one of the key components informing the Federal Reserve’s decision to cut or maintain interest rates. Other notable economic data releases later this week include the producer price index data and retail sales numbers, which will be announced on Thursday and Friday, respectively.
Scott Helfstein, head of investment at Global X ETFs, said “This is a busy week with consumer prices, producer prices, and retail sales. All of which could signal that the economy remains strong.” He added, “Ironically, markets may be less sensitive to data this week after the election and the Fed cut last week.
European stocks traded around the flatline Wednesday, with global markets focused on upcoming U.S. inflation data. Just Eat Takeaway stock soared 20% shortly after the open Wednesday after the company announced it had struck a deal to sell its U.S. unit Grubhub to Wonder for $650 million.
RWE was also a strong performer, its shares rocketing 19.1% Wednesday morning after the German energy company upgraded its mid-term financial targets. ING Groep traded 1% lower after the Dutch lender posted a 9% fall in quarterly net profit compared to a year earlier. Shares of Societe Generale were up 1.1% after the financial services group beat expectations with a 22% rise in third-quarter net profit.
U.S. stock futures were little changed Tuesday night. Futures tied to the Dow fell just 16 points, or 0.04%. S&P 500 futures ticked down 0.05% and Nasdaq-100 futures declined 0.09%.
Wall Street indexes experienced a decline as investor focus shifted to policies proposed by President Donald Trump and key economic data releases. On November 12, 2024, major indexes were down, with the Dow Jones Industrial Average dropping 0.86%, the S&P 500 slipping 0.29%, and the Nasdaq Composite falling 0.09%. Novavax shares fell 6% following a reduction in its annual revenue forecast.
Meanwhile, Honeywell stock reached a record high after Elliott Management disclosed a stake in the company. Tesla’s shares ended a five-day rally, also dropping 6%. Traders at the New York Stock Exchange reacted to these developments against a backdrop of rising U.S. Treasury yields and upcoming inflation data, which investors expect to influence the Federal Reserve’s policy decisions.
World stock markets saw a second consecutive day of declines as higher U.S. Treasury yields and inflation concerns continued to weigh on investor sentiment. The roaring rally in US stocks lost steam on Tuesday as investors assessed whether buying has been overdone and what President-elect Donald Trump’s Cabinet picks mean for policy. The Dow Jones Industrial Average slid nearly 0.8%, or almost 350 points.
The S&P 500 fell more than 0.2%, and the tech-heavy Nasdaq Composite was down roughly 0.1%, paring earlier losses.
Wall Street anxiously awaits inflation data
Stocks like Boeing were laggards in the Dow, falling more than 2.5%, due to ongoing production issues related to worker strikes.
Both the S&P 500 and Dow had their worst day since Oct. 31. The breather in equities came as Treasury yields ticked higher.
The 10-year Treasury yield added about 12 basis points to hit around 4.43%. Wall Street analysts are signaling that the post-election surge in stocks could soon sputter after lifting the major indices to record highs. Investors have raised their exposure to US stocks, Bank of America found.
At the same time, the market is pondering the policy impact of Trump’s likely Cabinet picks, which include several high-profile China hawks. The prospect of tougher tariffs has raised concerns that the next president’s economic plans could spur inflation. Bitcoin’s record-breaking rally continued, putting the cryptocurrency within striking distance of $90,000 per coin.
However, other cryptocurrency-linked stocks lost some fizz. Tesla’s stock slipped into the red after previously soaring thanks to CEO Elon Musk’s alliance with the incoming president. Shares of Coinbase struggled for gains.
Focus now turns to the upcoming Consumer Price Index (CPI) report, which will be watched for signs that inflation is cooling as the Federal Reserve desires. Federal Reserve Bank of Minneapolis president Neel Kashkari mentioned on Tuesday that a surprising uptick in inflation data could prompt the central bank to pause cutting interest rates. “It’d be hard to imagine the labor market really heats up between now and December,” Kashkari said.
On Tuesday, Boeing’s stock sank as much as 3% as the company said it handed over just 14 commercial planes in October, a significant drop from the same month last year due to a seven-week strike by its biggest union. Bank of America CEO Brian Moynihan supported Federal Reserve Chairman Jerome Powell’s stance against letting President-elect Trump influence the central bank’s monetary policy decisions. “At the end of the day, I think that our Federal Reserve [as] an independent central bank is a good place to be,” Moynihan said.
All three major indices hovered near session lows just before 12:30 PM ET. The Dow Jones Industrial Average slid about 0.6%, or more than 250 points, while the S&P 500 fell about 0.4%, and the tech-heavy Nasdaq Composite slipped about 0.3%. The move lower in stocks came as Treasury yields were on the rise with the 10-year Treasury yield hitting nearly 4.42%.
Snap’s stock fell about 4% on Tuesday after reports suggested President-elect Donald Trump might halt a potential US ban on TikTok. Consumers’ inflation expectations continue to move lower. A new October survey from the Federal Reserve Bank of New York showed consumers expect inflation at 2.9% in one year, down from the 3% seen a year prior.
This marked the lowest one-year outlook in four years. The S&P 500 is already trading at 22.2 times 2025 earnings estimates, according to research from FactSet. BlackRock’s chief investment officer of global fixed income, Rick Rieder, mentioned on Tuesday that he doesn’t “love” this high multiple but is still “long equities” due to continued demand for stocks via 401(k) flows and company buybacks.
Investors will be closely watching upcoming economic data and Federal Reserve actions as markets navigate these uncertain times.
