U.S. stocks fell on Thursday morning despite a new reading of December inflation coming in slightly higher than economists had expected, raising new questions about the Federal Reserve's interest rate path.
The S&P 500 (^GSPC) fell about 0.8% after the benchmark ended Wednesday at its highest close since January 2022, just shy of a new record. The Dow Jones Industrial Average (^DJI) slipped 0.6% and the Nasdaq (^IXIC) led losses, falling nearly 0.9%.
Stocks struggled this week as investors counted down to December's U.S. consumer inflation. This reading showed a slightly larger increase than expected as prices rose 0.3% month-on-month and 3.4% year-on-year. On a “core” basis that excludes the volatile food and energy categories, inflation rose 3.9% last year.
The pressure was seen as critical for traders, who have increasingly priced in the likelihood of a “soft landing” – where inflation falls to 2% without causing an economic downturn – since the last CPI report.
Meanwhile, US spot Bitcoin ETFs (full list here) began trading on Thursday following regulatory approval from the SEC on Wednesday.
Bitcoin (BTC-USD) climbed above $46,000 to trade at its highest level since March 2022, while rival Ether (ETH-USD) surged amid bets that the second-largest token will be next to get the ETF greenlight.
Ahead of Friday's quarterly financial update, Citigroup (C) said it would record more than $3 billion in one-time reserves and expenses in its results. Fourth-quarter earnings season is crucial for stocks given their dismal performance so far this year.
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Thu, Jan 11, 2024 at 6:15 p.m. GMTMicrosoft briefly overtakes Apple as the most valuable company in the world
Microsoft (MSFT) briefly surpassed Apple's (AAPL) market cap during Thursday's session, making it the most valuable publicly traded company in the world.
As Yahoo Finance's Dan Howley points out, the software giant took the top spot shortly after trading began, generating over $2.8 trillion in revenue.
Apple's market cap was also over $2.8 trillion, but was just behind Microsoft. Apple shares struggled in the first two weeks of the year as analysts at three banks downgraded the company's stock on fears of slowing iPhone demand.
Read more here.
Thu, Jan 11, 2024 at 5:46 p.m. GMTStocks down in afternoon trading
Shares fell at about 12:45 p.m. ET. on Thursday.
The S&P 500 (^GSPC) fell about 0.8% after the benchmark ended Wednesday at its highest close since January 2022, just shy of a new record. The Dow Jones Industrial Average (^DJI) slipped 0.6% and the Nasdaq (^IXIC) led losses, falling nearly 0.9%.
Some interest rate-sensitive sectors such as real estate and financials, which had performed well in the recent market rally, fell about 1%. Utilities led the losses, falling more than 2%.
Source: Yahoo Finance
- Thu, Jan 11, 2024 at 4:30 p.m. GMT
Oil prices rise as tensions rise in the Middle East
Oil futures rose sharply on Thursday after Iran seized an oil tanker in the Gulf of Oman, stoking fears of an escalation in tensions between the US and Tehran.
West Texas Intermediate (CL=F) rose more than 3% during the morning session. Brent futures (BZ=F) also rose more than 2.5% and traded above $78 a barrel.
According to Iranian state media, the Iranian military seized the tanker carrying Iraqi oil in retaliation for the US seizure of the same ship last year.
“The geopolitical escalation in the Red Sea region has once again reversed the bearish trend in futures,” Dennis Kissler, senior vice president at BOK Financial, said on Thursday.
Thursday's price action marked a change in direction from the previous session, when futures fell more than 1% following the release of weekly storage data. According to the Energy Information Administration, U.S. crude oil inventories rose by 1.34 million barrels last week.
- Thu, Jan 11, 2024 at 4:03 p.m. GMT
Bitcoin ETFs begin trading
The long-awaited spot Bitcoin ETF trading is underway.
A curated list on Yahoo Finance tracks all the action on the ETFs. Of the newly launched ETFs, BlackRock's iShares Bitcoin ETF (IBIT) recorded the highest volume in morning trading.
Bitcoin (BTC-USD) was trading at around $46,700 during the ETF action.
Below is a breakdown of the different fees associated with each ETF.
- Thu, Jan 11, 2024 at 3:22 p.m. GMT
Inflation is higher than expected, keeping the Fed's rate-cutting bets moving
December's inflation report came in slightly hotter than Wall Street expected, but that doesn't change investors' bets that the Fed's first rate cut could come in March.
As of early Thursday morning, markets were pricing in about a 67% chance that the Fed will cut interest rates in March, largely unchanged from the odds the previous day, according to the CME FedWatch Tool.
“I don’t think that’s enough to delay cuts,” Bank of America U.S. economist Stephen Juneau told Yahoo Finance Live. “We are looking for a marching cut that starts the cutting cycle. This leaves the door open. The door will definitely not be slammed.”
- Thu, Jan 11, 2024 at 2:37 p.m. GMT
Stocks are rising despite higher-than-expected inflation
U.S. stocks rose Thursday morning despite a new reading of December inflation coming in slightly higher than economists had expected, raising new questions about the Federal Reserve's interest rate path.
The S&P 500 (^GSPC) rose about 0.2% after the benchmark ended Wednesday at its highest close since January 2022, narrowly reaching a new record. The Dow Jones Industrial Average (^DJI) gained 0.1%, while the tech-heavy Nasdaq led the way with a gain of 0.3%.
Thu, Jan 11, 2024 at 1:47 p.m. GMTInflation is higher than expected in December
Thursday's highly anticipated inflation report showed consumer prices rose slightly more than expected in November.
A quick look at the numbers:
Overall CPI, month over month: 0.3% increase vs. expected 0.2%
Overall CPI YoY: 3.4% vs expected 3.2%
“Core” CPI YoY: 3.9% vs. 3.8% expected
Yahoo Finance's Josh Schafer has all the details here.
Thu, Jan 11, 2024 at 6:15 p.m. GMT
Thu, Jan 11, 2024 at 5:46 p.m. GMT
Thu, Jan 11, 2024 at 1:47 p.m. GMTClick here for a detailed analysis of the latest stock market news and events affecting stock prices.
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