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The stock market declined on October 12 as the US BLS released new data showing prices rose faster than expected.

October 12, 2023

Stocks fell in the US today as newly released inflation data overshot expectations. The Dow Jones Industrial Average fell by 173.73 points (0.51%), to 33,631.14. The S&P 500 declined by 27.34 points (0.62%), ending the day at 4,349.61. The tech-heavy Nasdaq index lost 85.46 points (0.63%), declining to 13,574.22.

At 8:30 am ET, the US Bureau of Labor Statistics released Consumer Price Index data for the month of September. It showed that prices increased 0.4% over the course of the month and 3.7% in the year preceding October 1. This was higher than the 0.3% for the month and 3.6% year-over-year estimated by Dow Jones. Traders interpreted the higher-than-expected figure as bearish for equities, as it could imply that the Federal Reserve will need to keep interest rates elevated for longer than previously expected as they attempt to keep inflation under control.

Despite this decline in the overall market, shares of some retail-sector companies did unusually well. Wallgreens gained 7% after it reported that its losses had not been as great as previously expected, and Dollar General stock surged by nearly 10% after-hours as the company announced that former CEO Todd Vasos will return to the company.

US Treasury yields rose as traders digested the new inflation data. The 10-year note gained 0.102 points, reaching 4.699%. The two-year gained 0.066 points, rising to 5.071%.

Gold fell by $6.52 per Troy Ounce, to 1,868.93. Gold has been trending down since May 4, when it peaked at $2,060.60. Since then, concerns about rising interest rates and a strong dollar have kept the yellow metal in decline.

Oil gained slightly today, with West Texas Intermediate adding a penny per barrel (0.012%) to its price to reach $83.50. Brent crude gained $0.56 (0.65%) per barrel to reach $86.38.

In the forex market, the US Dollar Index rose 0.76 points, to 106.58. The euro fell 0.85% to $1.0528. The yen fell 0.47%, causing the number of yen needed to buy a dollar to rise to 149.7720. Many traders believe that Japanese monetary authorities will intervene if this number rises above 150.

Information for this news item was sourced from Apmex, CNBC, MSN Money, Yahoo Finance, and Business Insider.

Vintage Markets is dedicated to the in-depth exploration and reporting of traditional financial news, tracing the journey of global markets and economies from the Stone Age to the Stoned Age.

All US stock indices rose on October 11, as traders awaited consumer price index data to be released on the 12th.

October 11, 2023

US stocks rose for the fourth day in a row today, as traders waited for the consumer price index report to be released on October 12. The Dow Jones Industrial Average increased by 65.57 points (0.19%), to 33,804.87. The S&P 500 gained 18.71 points (0.43%), closing at 4,376.95. The Nasdaq went up by 96.83 points (0.71%), ending the day at 13,659.68.

Despite today’s uptick, stock prices are lower than they were in July, as fears of interest rate increases have dominated the market narrative since then. Bears expect inflation to rise faster than anticipated, causing the Fed to respond with more rate hikes, while bulls are more optimistic that inflation will stay under control and not require interest rates to rise much further. The Bureau of Labor Statistics is expected to release inflation data for September tomorrow. Economists surveyed by Dow Jones have estimated that the US experienced an inflation rate of 0.3% in the month.

Minutes for the September Federal Open Market Committee meeting were released today, revealing that the majority of members expect that at least one more rate hike will be needed this cycle, although some members disagreed with this majority viewpoint. All members agreed that rates will need to remain high until sufficient evidence proves that inflation is moving back to 2% per year.

The 10-year and two-year US Treasury yields moved in opposite directions over the course of the day. The 10-year fell by 0.1 points, to 4.564%. The two-year rose by 0.002 points, to 4.986%. The yield-curve remains inverted, which some traders view as a sign of an impending recession.

Despite the Fed’s talk of interest rate increases, gold traders remained bullish. Gold gained $13.81, rising to $1,873.56 per Troy Ounce.

Oil declined, with West Texas Intermediate falling $2.62 per barrel, to $83.33 and Brent crude falling $2.03 per barrel, to $85.62. Oil surged over 4% on Monday, when traders began to fear that new Iran sanctions may be imposed due to the Israel-Hamas conflict. However, it began to slip back to lower levels on Tuesday after Iran denied involvement in the conflict, and this decline has continued today.

In the forex market, the US Dollar Index fell 0.1%, to 105.73. The euro rose 0.1275%, to 1.0622. The yen fell 0.2777%, causing the number of yen needed to buy a dollar to rise to 149.1180. Some traders expect the Bank of Japan to intervene if this number rises above 150.

Information for this news item was sourced from CNBC, Marketwatch, Kitco, Business Insider and MSN Money.

Vintage Markets is dedicated to the in-depth exploration and reporting of traditional financial news, tracing the journey of global markets and economies from Stone Age to Stoned Age.

Treasury yields declined, giving stock market bulls new momentum.

October 10, 2023

Stocks in the US rose for the third straight day as the market continues to assess the effect of the Israeli-Hamas conflict. Bond yields fell as investors desired the safety of US Treasuries, and these falling yields helped to bolster the stock market. Today was the first day that Treasuries have been traded since the start of the Israeli-Hamas conflict, as the bond market was closed on Monday.

The Dow rose 134.65 points (0.4%), to 33,739.30. The S&P 500 gained 22.58 points (0.5%), reaching 4,358.24. The Nasdaq climbed 78.61 points (0.6%), ending the day at 13,562.84.

The yield on the US 10 Year Treasury Note fell 0.149 points, to 4.655%, and the 2-year note fell 0.148 points, to 4.961%. The yield on a Treasury Note is inversely related to its price, so a falling yield implies a rising price for it. Stocks have been under pressure since July, as continuously rising yields have attracted investors to Treasuries instead of stocks, but today’s pullback in yields was seen as a welcome relief by stock market bulls.

Oil prices declined as war-related fears began to wane. West Texas Intermediate crude fell by $0.59 per barrel, to $85.79, while Brent crude declined by $0.03, to $87.62. Over the weekend, some traders had begun to fear renewed sanctions against Iran, which could reduce supply and drive up prices. But Iran denied involvement on Monday, which gradually began to reduce these expectations.

Gold prices saw a reduction of $0.79 per Troy Ounce, falling to $1,860.48. Despite an early dip, a rally emerged around 10:30 am ET, enabling gold to recover a significant portion of its earlier losses.

The US Dollar Index rose 0.29%, to 105.77. The euro gained 0.3852%, ending up at 1.0606. The yen fell 0.1%, causing the number of yen needed to buy a dollar to rise to 148.6660.

Vintage Markets is dedicated to the in-depth exploration and reporting of traditional financial news, tracing the journey of global markets and economies from Stone Age to Stoned Age.