Stock markets today: Dow, S&P 500 shaky after expected inflation print

U.S. stocks were lower on Thursday after the latest consumer inflation print came in hotter than expected, further clouding the picture for the Federal Reserve's next interest rate decision in November.

The Dow Jones Industrial Average (^DJI) slipped 0.4%, and the S&P 500 (^GSPC) fell more than 0.3% to hit fresh record highs on Wednesday. The tech-heavy Nasdaq Composite (^IXIC) was off about 0.1%.

Chip heavyweight Nvidia ( NVDA ) rose more than 1% as it rose to a record high, while e-commerce giant Amazon ( AMZN ) also rose, helping the Nasdaq pare earlier losses.

The focus on Thursday was a reading on consumer inflation that showed prices rose 0.2% last month, more than the 0.1% rise Wall Street had expected. On an annual basis, prices rose 2.4%, which was 2.3% expected. The data was of more interest than usual as investors grappled with the possibility of a “no landing” for the economy as last week's jobs report reignited concerns that inflation was rising again.

But the jobs market delivered a surprise of its own on Thursday, as initial jobless claims rose to 258,000, more than Wall Street expected and the highest print since August 2023.

Read more: What Fed Rate Cuts Mean for Bank Accounts, CDs, Loans and Credit Cards

Among all moving parts, traders now see an 18% chance the Fed will keep rates steady in November, according to the CME FedWatch tool. Just a week ago, the probability of no cut was 0% as markets heeded the message from policymakers and prepared for a 25 basis point rate cut.

Tesla ( TSLA ) has its highly anticipated Robotaxi event on Thursday evening. CEO Elon Musk is expected to unveil a two-door, butterfly-wing prototype of the CyberCab he's betting on the future of the EV maker.

live12 updates

Thursday, October 10, 2024 at 10:45 AM PDT

Social Security benefits will increase by 2.5% in 2025

Yahoo Finance columnist Kerry Hannon wrote:

Social Security benefit increases next year will be pocket-sized.

The Social Security Administration announced a 2.5% cost-of-living adjustment (COLA) for 2025. That's down from 3.2% this year but in line with the 2.6% average over the past two decades

Starting in January, the increase will add a little less than $50 to an average monthly benefit of about $1,900, according to the SSA, to more than 72 million retired senior citizens and disabled workers who have been saddled with higher prices in recent years. Will give some relief. .

Read more here.
Thursday, October 10, 2024 at 10:01 AM PDT

Fed's Bostick 'comfortable' with avoiding interest rate cut at upcoming meeting: WSJ

Atlanta Fed President Raphael Bostick told the Wall Street Journal in an interview that he “would feel comfortable skipping a meeting if the data seemed appropriate.”

Additionally, the Bostick Journal's Nick Timiraos said he only made one additional interest rate cut for 2024 in his latest submission to the Summary of Economic Projections.

“So that already signals that I'm open to not moving in one of the last two meetings if the data comes in as I expect,” Bostic said.

Bostic's comments came after an expected September jobs report and a reading on September inflation that showed price increases are not cooling as quickly as expected led investors to bet that the Fed may not cut interest rates further at its November meeting.

Traders now see a 15% chance the Fed will keep rates steady in November, according to the CME FedWatch tool. Just a week ago, the chance of no cut was 0%.
Thursday, October 10, 2024 at 9:30 am PDT

Mortgage rates rose for the biggest 1-week jump since April

Claire Boston of Yahoo Finance reports:

Mortgage rates rose sharply last week, a new challenge for distressed house hunters and potential refinance candidates.

The average rate on a 30-year fixed-rate loan rose to 6.32% in the week through Wednesday, up from 6.12% a week earlier, according to Freddie Mac. This is the biggest week-over-week increase since April.

Read more here.
Thu, Oct 10, 2024 at 9:05 am PDT

WeightWatchers continues to rally furiously on new GLP-1 offerings

WW International (WW), better known as WeightWatchers, rose more than 15% on Thursday. The stock went on a furious rally this week after the company announced it would offer a copycat weight-loss drug like Novo Nordisk (NVO).

WeightWatchers shares rose 38% on Wednesday, and the stock is up nearly 160% over the past week but remains far from a record high of $100 in 2018. The company has struggled amid intense competition in the weight loss space, an unsuccessful rebrand, and related disruptions to Covid-19.

US law allows companies to sell compounded versions of drugs on the Food and Drug Administration's shortage list. The federal agency recently removed Eli Lilly's ( LLY ) GLP-1 drug from the deficiency list, meaning the companies can no longer sell compounded versions of the drug's active ingredient, tirzepetide.

WeightWatchers will sell a compounded version of Semaglutide, the active ingredient in Novo Nordisk's Ozempic and Wegovy.
Thursday, October 10, 2024 at 8:46 AM PDT

Oil prices rose 2% on concerns that the Israel-Iran conflict would affect supplies

Oil rose as much as 2% on Thursday as traders assessed whether ongoing tensions between Israel and Iran would disrupt supplies.

West Texas Intermediate (CL=F) traded above $74 a barrel, while Brent (BZ=F), the international benchmark price, jumped more than 2% to near $78 a barrel.

“Crude [is] Today continues to find a balanced price hike as uncertainty remains over when and where Israel will strike Hezbollah and Iran,” Dennis Kiesler, senior vice president of trading at BOK Financial Securities, said in a note on Thursday.

Hurricane Milton's Florida landfall also put markets on edge. Production and refinery operations are not expected to be disrupted. However, analysts expected gas stations to be short on supplies to disrupt distribution around the affected areas.
Thu, Oct 10, 2024 at 8:29 am PDT

The need for the Fed to cut rates gradually reinforces the CPI bearish outlook

Yahoo Finance's Jennifer Schoenberger reports:

A warmer-than-expected inflation reading released Thursday provided fresh ammunition for Federal Reserve hawks arguing for a slower pace of interest rate cuts.

According to some Fed watchers, the report is unlikely to change the course indicated by policymakers for smaller future cuts after an initial 50 basis point reduction in September.

Investors, in fact, expect the Fed to trim its policy rate by 25 basis points to 87% in November after the CPI release.

Read more here.
Thu, Oct 10, 2024 at 7:41 am PDT

Home construction inflation declined in September in a 'sharp contrast' to the previous month

Hamza Shaban of Yahoo Finance reports:

September's Consumer Price Index (CPI) report came in hotter than analysts expected, but the data offered a major point of optimism: Housing spending growth slowed in the month, an encouraging economic signal that the most stubborn contributor to inflation may finally be giving way.

“The sharp shift in shelter inflation could accelerate again after a jump in August and reverse the upward trend we've consistently expected,” said Parker Ross, global chief economist at Arch Capital Group.

Read more here.
Thursday, October 10, 2024 at 7:16 am PDT

Gas prices and the energy index fell, but not enough to offset the hot CPI

Falling gasoline prices were not enough to offset higher food and housing prices in September, adding to the expected inflation print.

According to Bureau of Labor Statistics data released Thursday, the gasoline index fell 4.1% last month, compared with a 0.6% decline the previous month.

On an annualized basis, gasoline prices fell 15.3%, while the energy index fell 6.8% overall.

Read more here.
Thursday, October 10, 2024 at 6:30 am PDT

Tech stocks fell after September consumer prices rose more than expected

Major averages opened lower on Thursday after the monthly Consumer Price Index (CPI) was hotter than expected, setting expectations that the Federal Reserve will opt for a smaller rate cut at its meeting next month.

Dow Jones Industrial Average futures (^DJI) fell about 0.2%, while the S&P 500 (^GSPC) fell about 0.3%. Both slipped from their new record-high closes. The tech-heavy Nasdaq Composite ( ^IXIC ) also fell 0.5%.

Technology ( XLK ) led the decline, followed by Consumer Discretionary ( XLY ). On the upside, energy (XLE) stocks rallied as oil jumped Thursday morning.

Investors expect the Federal Reserve's next interest rate hike to be 25 basis points after inflation rose 0.2% in September, instead of 50, which Wall Street had expected to rise 0.1%, according to the latest government data.
Thursday, October 10, 2024 at 5:55 AM PDT
Delta stock falls after earnings miss, CEO blames crowdstrike

Delta Air Lines ( DAL ) reported third-quarter earnings that missed Wall Street expectations Thursday morning, Yahoo Finance's Brad Smith reports. Miss sent its stock down as much as 7% in premarket trading before the loss.

Here's a look at its performance against analyst estimates compiled by Bloomberg.

Adjusted net income: $971 million vs. $981 million expected

Adjusted earnings per share: $1.50 vs. $1.52 expected

Revenue: $14.59 billion vs. $14.68 billion expected

Delta said it forecast earnings per share of $1.60 to $1.85 for the fourth quarter, with the $1.73 midpoint expected by Wall Street analysts of $1.78, according to Bloomberg data.

Delta CEO Ed Bastian blamed the disruption on a massive crowdstrike outage in mid-July. Problems with CrowdStrike's cybersecurity software, used by Delta, forced the airline to cancel thousands of flights and wiped $380 million from its revenue for the quarter, he said.

“We had 86 great days and we had five days that were affected by the crowd strike,” Bastian told Yahoo Finance.

Read the full story here.
Thursday, October 10, 2024 at 5:42 AM PDT

Jobless claims unexpectedly rose to highest since August 2023

Weekly jobless claims rose more than expected last week in the latest sign that the labor market has shown some strength, with the job market still cooling.

New data from the Labor Department showed 258,000 initial jobless claims were filed in the week ended Oct. 5, up 225,000 from the previous week and 230,000 more than economists expected. It marked the highest weekly jobless claim since August 2023.

Meanwhile, the number of continued claims for unemployment benefits reached 1.86 million, up 42,000 from the previous week.
Thursday, October 10, 2024 at 5:32 AM PDT

Prices rose more than expected in September

A closely watched report on US inflation showed that consumer prices rose more than expected in September, according to the latest data from the Bureau of Labor Statistics released Thursday morning.

The Consumer Price Index (CPI) rose 2.4% in September from a year earlier, an acceleration from August's 2.5% annual price increase. Annual growth of 2.3% was higher than economists had expected.

The index rose 0.2% from the previous month, above Wall Street expectations for a 0.1% increase.

On a “core” basis, which strips out the more volatile costs of food and gas, prices rose 0.3% in September from the previous month and 2.4% from a year ago. Core prices rose 0.3% month-on-month and 3.2% year-on-year in August. Both monthly and annual key readings were hotter than economists expected.