U.S. stocks are expected to open sharply lower on Wednesday after a key inflation report showed an unexpected rise in consumer prices last month.
Futures on the Dow Jones Industrial Average (^DJI) fell over 1%, while those on the S&P 500 (^GSPC) and the tech-heavy Nasdaq 100 (^NDX) each fell over 1.25%.
Meanwhile, bond yields soared. The 10-year Treasury yield (^TNX) rose as much as 14 basis points on Wednesday morning, surpassing 4.5% for the first time in 2024.
The consumer price index (CPI) rose 0.4% in March from the previous month and 3.5% from a year earlier, an acceleration from the 3.2% annual price increase in February.
Both metrics were above economists' forecasts, which called for a 0.3% increase from the previous month and an annual increase of 3.4%, according to data compiled by Bloomberg.
The hotter-than-expected print could lead investors to expect fewer interest rate cuts from the Fed this year. According to the CME FedWatch tool, around 75% of bets are now that the Fed will keep its current interest rate level stable in June. More than half of investors also expect the central bank to stick to its course until its July meeting.
Minutes from the Fed's March meeting are still available Wednesday, which will likely be closely scrutinized for clues about whether policymakers' expectations of rate cuts are waning.
First-quarter earnings season kicked off with Delta's (DAL) results coming into focus as the airline industry grapples with the fallout from Boeing's (BA) ongoing woes. Shares of the airline rose nearly 5% premarket after earnings beat expectations.
That sets the stage for Friday's reports from major Wall Street banks, whose earnings aren't expected to be stellar even as Wall Street expects a record season.
live5 updates
- Wednesday, April 10, 2024, 7:46 a.m. CDT
Inflation is higher than expected in March
The consumer price index (CPI) rose 0.4% in March from the previous month and 3.5% from a year earlier, an acceleration from the 3.2% annual price increase in February.
Both metrics were above economists' forecasts, which called for a 0.3% increase from the previous month and an annual increase of 3.4%, according to data compiled by Bloomberg.
Futures tied to the three major indexes fell about 1% on the news.
Wednesday, April 10, 2024, 7:26 a.m. CDT
As companies cut back on spending before the election…
As seen in Delta (DAL) results this morning, this practice is not included in travel budgets.
Delta said first-quarter enterprise revenue under management increased 14% year-over-year. There was particular strength among “large” corporate customers, which bodes well for key Delta partner American Express (AXP)'s gains in a few weeks.
“We've seen really strong demand,” Delta Air CEO Ed Bastian told Yahoo Finance host Brad Smith. “This dynamic has continued internationally. It also continues domestically. …Year to date, we have experienced the 11 highest sales days in our company's history. “This is a strong indicator that the spring and summer seasons will be fairly healthy.” Travel site.”
Wednesday, April 10, 2024, 6:54 a.m. CDT
Nvidia weakness remains
More people should talk about the weakness of market leader Nvidia (NVDA).
The stock slipped below the 50-day moving average (see chart below) earlier this month and has remained below this key momentum line ever since. Shares fell nearly 6% in April, compared with a slight decline in the S&P 500.
A sign that the markets are in for a difficult phase this summer? Maybe this stock has been the leader of the bull market for well over a year after all! So if it's not directional, there may be something off in the distance that's worrying investors.
Market leader Nvidia goes under. (Yahoo Finance)
Wednesday, April 10, 2024, 5:30 a.m. CDT
Reserve an appointment for fans of crypto investments
JP Morgan strategists announced this morning that the next Bitcoin halving is scheduled to take place on April 16th.
In case you forgot, here Yahoo Finance host Brad Smith explains exactly what a Bitcoin halving is and what it could mean for the cryptocurrency.
The JP Morgan team has also provided some good charts to get you thinking about the Bitcoin mining prospects, with the process potentially being a catalyst for further price increases.
More Bitcoin halving events are on the horizon. (JP Morgan)
The short-term outlook for Bitcoin mining. (JP Morgan)
Wednesday, April 10, 2024, 5:00 a.m. CDT
Here are market statistics to help you start your day
Remember when the market was rising almost every day in March?
So far in April, that hasn't been the case, and the losers are starting to pile up.
The S&P 500 has now gone seven sessions in a row without setting a new record, Deutsche Bank's strategy team emphasized this morning. That's the longest stretch without an all-time high since January, when the S&P 500 surpassed its 2022 peak.
The next strike must be broken: The S&P 500 is currently posting five consecutive monthly gains since November.
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