Last Updated 4:05 PM EST
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Stock indices finished today’s trading session in the green. The Dow Jones Industrial Average (DJIA), the S&P 500 (SPX), and the Nasdaq 100 (NDX) gained 0.64%, 0.34%, and 0.5%, respectively.
The consumer staples sector was the session’s laggard, as it gained 0.8%. Conversely, the energy sector was the session’s leader, with a gain of 1.91%.
Furthermore, the U.S. 10-Year Treasury yield decreased to 3.43%. Similarly, the Two-Year Treasury yield also decreased, as it hovers around 4.13%. This brings the spread between them to -70 basis points.
Compared to yesterday, the market is pricing in a higher chance of a lower Fed Funds rate for June 2023. In fact, the market’s expectations for a rate in the range of 5.25% to 5.5% decreased to 4.7% compared to yesterday’s expectations of 8.6%.
In addition, the market is now also assigning a 52.1% probability to a range of 4.75% to 5%. For reference, investors had assigned a 45.2% chance yesterday.
Last Updated 1:00PM EST
Stocks are in the green after struggling in the earlier portions of the day. As of 1:00 p.m. EST, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq 100 are up 0.8%, 0.5%, and 0.6%, respectively.
Last Updated 11:00AM EST
Stock indices are struggling to find a direction so far in today’s choppy trading session. Indeed, they continue to alternate between gains and losses as investors try to digest today’s CPI report, which came in line with expectations.
On Thursday, the Department of Labor released its Initial Jobless Claims report, which came in better than expected. In the past week, 205,000 people filed for unemployment insurance for the first time. Expectations were for 215,000 individuals.
When using the four-week average, initial jobless claims were 212,500, down from last week’s reading of 214,250. It’s worth noting that this figure has been in a downtrend since December 8, 2022.
In addition, Continuing Jobless Claims, which measures the number of unemployed people who qualify for unemployment insurance, came in at 1.634 million. This was below the forecast of 1.705 million and lower than last week’s print of 1.697 million.
Continuing Jobless Claims have been steadily increasing since the end of September as the layoffs from large companies continue to impact the workforce. Nevertheless, it has seen two consecutive months of decline.
Last updated:9.42AM EST
Markets were volatile on Thursday morning after the inflation data came in line with expectations but at the same time, the prospect of a hike in interest rates still loomed.
The Dow Jones Industrial Average lost 0.2% while the S&P 500 retracted by 0.3%, as of 9:42 a.m. EST, Thursday. Meanwhile, the Nasdaq 100 declined by 0.4%
Last updated:8.52AM EST
U.S. stock market futures are volatile on Thursday morning as traders were digesting the Consumer Price Index (CPI) data for December. CPI numbers came as expected, with core inflation up 5.7% year-over-year. The December read was -0.1% vs. expectations of +0%.
Futures on the Dow Jones Industrial Average (DJIA) rose 0.15% while those on the S&P 500 (SPX) were up 0.07%, as of 8:52 a.m. EST, Thursday. Meanwhile, the Nasdaq 100 (NDX) futures were up 0.2%.
Economic Predictions
Economists surveyed by Dow Jones expect the prices to have declined 0.1% on a monthly basis, and risen 6.5% year-over-year. If the reading meets expectations, this will be the third straight month of deflation.
That said, inflation is still far from the Fed’s target rate of 2%-3%. Moreover, the Fed is unlikely to pivot until it takes the short-term borrowing rate to at least 5%. The question, however, is how quickly the central Bank will tighten up the economy.
In the upcoming FOMC meeting, the Fed is likely to increase interest rates by 25-50 basis points. A 75 basis point hike, although still on the table, could send the economy into a mild shock and hurt the stock market. However, the pace depends to a large extent on the CPI data due out later on Thursday.
Other Financial News: Earnings Ahead
Investors are also anxiously awaiting the earnings season. Quarterly earnings releases of several big banks are due on Friday, giving investors the first look at how the financial sector has performed in the final quarter of 2022.
Some of the banks lined up for Friday are Bank of America (NYSE:BAC), shadow bank BlackRock (NYSE:BLK), Citigroup (NYSE:C), and more.
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