[Wall Street] Cautious Ahead of CPI Week; Indexes Mixed as Micron Plunges

Oil Prices Rise Amid Middle East Tensions

With third-quarter corporate earnings reports and the September Consumer Price Index (CPI) release due this week, Wall Street's three major indexes were mixed on Oct. 12 (local time). Micron Technology plunged on news of technological advances by Chinese semiconductor companies, leaving the tech-heavy Nasdaq relatively weaker.

As of 10:35 a.m. in New York, the Dow was trading at 51,912.22, up 257.27 points, or 0.50%, from the previous session. The S&P 500, which is weighted toward large-cap stocks, was down 5.48 points, or 0.07%, at 7,806.06, while the tech-heavy Nasdaq was down 92.88 points, or 0.34%, at 27,273.28.

Markets were notably cautious as investors awaited the September CPI report due this week. In particular, the Nasdaq was falling as Micron, a U.S. memory chipmaker, plunged on news of technological advances by Chinese semiconductor companies.

Among individual stocks, Micron plunged 4%. Concerns about intensifying competition grew after reports that Chinese memory chipmaker ChangXin Memory Technologies (CXMT) had made progress in developing a new semiconductor structure. By contrast, Salesforce rose 2%, supporting the Dow, after Bank of America (BofA) raised its rating on the stock by two notches.

International oil prices also rose. U.S. President Donald Trump announced over the weekend that Russia and Ukraine had agreed to halt attacks on energy facilities. But geopolitical uncertainty came back into focus after Ukrainian President Volodymyr Zelenskyy said Russia had already violated the agreement. West Texas Intermediate (WTI) crude traded at around $93 a barrel on the New York Mercantile Exchange, up 2.28% from the previous session, while Brent crude rose 2.27% to $106 a barrel on the Intercontinental Exchange.

Tensions in the Middle East also continued. Following another attack that caused casualties at Riyadh International Airport in Saudi Arabia, Trump said the United States was considering taking part in Saudi military operations against Yemen's Iran-backed Houthi rebels. This raised concerns that military conflict in the Middle East could escalate.

Market attention is focused on third-quarter earnings season, which gets underway in earnest this week. According to John Butters of financial data provider FactSet, net income at S&P 500 companies is expected to rise 29.6% year over year in the third quarter. If the forecast proves accurate, earnings growth will have exceeded 25% for four consecutive quarters. Improved corporate earnings, driven in part by the expansion of AI data center construction, are seen as a key factor.

However, investors are paying more attention to the outlooks company executives will provide than to the earnings figures themselves. With oil prices and borrowing costs remaining high, a key question is whether companies can pass rising costs on to consumers and protect their margins.

Brian Leonard, portfolio manager of the Kiley Gabelli Small-Cap Dividend Fund, said, "Investors are focused on whether companies can withstand current conditions, continue to increase margins while passing on costs, and whether things ahead can be better than they have been recently."

This week, major U.S. banks, including JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, Morgan Stanley and Wells Fargo, will all report earnings.

Inflation data is another key factor. The U.S. September CPI is due on Oct. 14, followed by the Producer Price Index (PPI) on Oct. 15. Investors are expected to assess the impact of high oil prices on inflation and gauge the Federal Reserve's future monetary policy direction.

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