Inflation figures still high, stock index first climbed then fell

Investors took the latest U.S. Inflation data continued to be digested, and the U.S. The stock fell to 11th position, surpassing early gains. (The Associated Press)


InvestmentAs people read about the latest U.S. Continuing to digest inflation data, the U.S. The stock fell to 11th position, curtailing early gains.

Nasdaq CompositeindexIt fell 373.44 points or 3.18% to 11,364.24. The S&P 500 fell 65.87 points, or 0.65%, to 3,935.18. The Dow Jones Industrial Average fell 326.23 points, or 1.02%, to end at 31,843.11.


“Everyone wants energy, food and labor costs to go down, but at the same time, the mechanism for this is to raise interest rates,” said Susan Schmidt, a strategist at Aviva Investors. Investment people are worried as they are trying to figure out how it affects the overall business, which is why I think the major indices have come down like this.”

The historical index hit a low of 3,928.82 and closed down more than 18% from its 52-week high; It is down more than 17% this year.

Tech stocks outperformed the Nasdaq’s gains. Meta Platforms and Netflix fell 4.51% and 6.35%, respectively, Apple fell 5.18%, and Salesforce and Microsoft fell 3.52% and 3.32%, respectively, as investors continued to exit growth stocks. Information technology and consumer discretionary stocks fell more than 3 percent, weighing on the historical index.

Meanwhile, Visa and Merck were top performers in the Dow. Even with the downturn in the financial sector. While most sectors fell into negative territory, the energy sector gained 1.4%. Utilities struggled to stay positive, up 0.8%; Material stock ended flat.

The Consumer Price Index (CPI) jumped 8.3% in April, higher than the 8.1% expected by economists surveyed by Dow Jones. The rally in March remained close to 40-year high of 8.5 per cent.

Core CPI, which does not include food and energy prices, rose 6.2%, beating expectations of 6.2% growth. Headline CPI grew 0.3% and core CPI 0.6% on a monthly basis. This means inflation may peak, but price pressures are likely to remain.

Not all analysts are convinced that the figures suggest inflation is peaking.

“With the annual rate falling from 8.5% to 8.3%, we’re likely to say we’ve seen a peak, but we thought we did last August,” said Greg McBride, chief financial analyst at Bankrate.

Some analysts believe that the data, which shows the Federal Reserve is behind the curve in keeping inflation under control, could put pressure on the Fed to act more aggressively to tighten monetary policy.

US in BMO Rates chief Ian Lingen said: “Risk assets came under pressure and stock futures fell on the assumption that it would force the Fed to extend rates by 50 basis points beyond the previously implied June and July meetings. “

Meanwhile, rising prices have been making headlines, especially after the Fed raised interest rates and slashed its balance sheets to fight inflation.

10 years after the release of the data treasury noteyieldIt briefly climbed above the 3% mark but later traded at 2.948%.

Allianz’s chief economic adviser, Mohamed El-Arian, said the initial negative market reaction to inflation data is “completely understandable”, but as prices continue to rise, the US is on the verge of a “cost of life crisis”. But was.

“It is only a matter of time before we talk about the cost of living crisis, that is,” he said. “Everyone is looking at the inflation numbers, which is understandable, but look at the 6.2 percent increase in the core CPI. And look at the inflation structure, it’s showing there are a lot of drivers. It’s just Ukraine now. It’s not a matter of war, it’s a broad-based inflationary process and the Fed is largely behind.”

The index has fallen nearly 16% from its highs in this year’s pullback, largely on fears of runaway inflation that has led the Fed to sharply tighten monetary policy.

On the earnings front, shares fell 26.4% after cryptocurrency exchange Coinbase released its latest quarterly results.

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