The final results of the session indicate that the Dow Jones Industrial Average slightly decreased by 0.02%, while the Nasdaq also fell by 0.03%, remaining essentially stable.
The broader S&P 500 gained 0.03%, also maintaining a stable stance, yet managed to reach a record closing high at 6,468.54 points.
“Everything is quite stable (…) which is quite positive, given the magnitude of the PPI drop,” remarked Art Hogan from B. Riley Wealth Management to France-Presse (AFP).
Investors reacted negatively to the initiation of the Producer Price Index (PPI) negotiations, which increased by 0.9%, according to data released today by the Department of Labor, after remaining stable in June.
This rise is significantly larger than market expectations, which predicted a 0.2% increase in prices in July, according to forecasts by MarketWatch.
Excluding the prices of food, energy, and trade services, considered more volatile, the rise in producer prices remains significant at 0.6%.
This marks the most pronounced increase in the underlying index since March 2022, shortly before the inflation peak observed in the summer of 2022 in the United States.
“Rates are forcing companies to increase the prices they charge each other, which will eventually lead to higher consumer prices,” noted Bill Adams from Comerica Bank.
Furthermore, “this report is another factor against an interest rate cut” by the U.S. central bank, highlighted the analyst.
Most experts still anticipate an interest rate cut at the next Federal Open Market Committee (FOMC) meeting, according to the CME monitoring tool.
However, fewer experts are forecasting further cuts in the subsequent meetings.
According to Hogan, investors will be closely watching the release of retail sales figures on Friday, which could ‘shake’ Wall Street.
In the bond market, by 20:15 (Lisbon time), the yield on 10-year U.S. government bonds rose sharply to 4.28%, compared to 4.23% at Wednesday’s close.
Market participants continue to monitor trade developments, particularly with some of the United States’ key trading partners.
“China is still in negotiations, while Mexico and Canada are in limbo,” explained Hogan.
“Until we sign agreements [with these countries], we can’t really say we’ve ended this trade war,” the analyst added.
In the stock market, semiconductor giant Intel jumped 7.38% to $23.86, after Bloomberg reported that the U.S. government might acquire a stake in the company.
Intel ended 2024 with better-than-expected results, but the outlook was considered very weak by the market.
