[New York Stocks] S&P 500, Nasdaq Rise on Slowing CPI

Dow Swings Amid Intense Volatility
Global Oil Prices Edge Slightly Lower

As the U.S. consumer price index (CPI) for July showed signs of slowing, the three major indices on the New York Stock Exchange displayed mixed movements on August 12 (local time), driven by expectations that the benchmark interest rate will be held steady. The Dow Jones Industrial Average is hovering around the 53,750 level.

As of 10:10 a.m. at the New York Stock Exchange (NYSE), the Dow is trading at 53,770.27, down 21.58 points (0.04%) from the previous session. The large-cap focused S&P 500 index is up 20.54 points (0.27%) to 7,748.74, while the tech-heavy Nasdaq index is showing a gain of 184.56 points (0.70%) to 26,630.00.

New York Stock Exchange, New York, USA. Photo by Yoonjoo Hwang

On this day, with the news of July’s slower CPI growth being digested, investor sentiment is rising for the S&P 500 and Nasdaq indices.

The U.S. Bureau of Labor Statistics announced that the July CPI increased by 3.4% compared to the same month the previous year. This increase is lower than the 3.5% rise in June and matches the expert consensus compiled by Dow Jones. The month-on-month growth rate was 0.1%.

The core CPI, excluding energy and food, rose 2.5% year-on-year, also lower than June’s 2.6%. Compared to the previous month, it was up by 0.2%. The year-on-year and month-on-month growth rates for both the headline CPI and core CPI, as released today, matched the market expectations compiled by Dow Jones.

Energy prices, after falling 5.7% month-on-month in June, dropped a further 1.5% in July, contributing to the slowdown in the overall index growth. Housing costs, which have been a key factor in keeping consumer price inflation stubbornly high, also recorded just a 0.1% increase from the previous month.

CNBC reported, following this employment indicator, that the likelihood of the Federal Reserve (Fed) holding rates at the Federal Open Market Committee (FOMC) meeting in September has increased. According to CME FedWatch, federal funds rate futures trading is currently pricing in about a 58% chance that the benchmark rate will be maintained in the current range of 3.50% to 3.75%. This is up from about 45% a week earlier.

Ellen Zentner, chief U.S. economist at Morgan Stanley Investment Management, said, "If inflation stays at an appropriate level, the outlook formed after last week's employment report that 'there is no need for a rate hike' will become even firmer."

She further analyzed, "With another set of inflation data expected to be released before the September FOMC meeting, the situation could change, but unless the data changes significantly, the Fed is highly likely to hold rates again next month."

Shares related to artificial intelligence (AI) are also rising, supporting gains on the Nasdaq. Notable gains include Dell Technologies up 4.77%, Micron Technology up 6.04%, Cisco Systems up 2.51%, and Nvidia up 2.77%.

AI cloud company CoreWeave is up 21.09% following strong earnings the previous day, while Super Micro Computer is rising by 14.05% on stronger-than-expected earnings guidance.

Meanwhile, on the New York Mercantile Exchange, West Texas Intermediate (WTI) crude for September delivery is trading at $82.80 per barrel, down 0.55% from the previous session. On the ICE Futures Exchange, Brent crude for October delivery is quoted at $88.67 per barrel, down 0.26% from the previous session.

This content was produced with the assistance of AI translation services.