Wall Street Today | US Core CPI Picks Up, Keeping Another Fed Hike in Play This Year
MACRO
US Core CPI Picks Up, Keeping Another Fed Hike in Play This Year
Underlying US inflation ran faster than expected in August, leaving the door open for additional interest-rate hikes from the Federal Reserve.
The so-called core consumer price index, which excludes food and energy costs, advanced 0.3% from July, marking the first acceleration since February, Bureau of Labor Statistics data showed Wednesday. From a year ago, it increased 4.3%, in line with estimates and marking the smallest advance in nearly two years.
Traders Flip to Bet on ECB Hike as Inflation Upends Rate View
In days, the market has completely changed its view of what the European Central Bank is likely to do on Thursday, highlighting just how much uncertainty surrounds the decision.
Money markets are now pricing in a 68% chance the ECB will raise interest rates by a quarter of a percentage point. The view has changed rapidly in recent weeks as evidence builds that Europe is facing persistent inflation that’s been made worse by soaring energy prices.
At the start of September, traders were firmly in the camp that the ECB would hold rates steady to keep economic growth intact, with markets reflecting 20% odds of a hike.
SECTORS
Oil Hovers at Yearly Highs as IEA Adds to Tight Market Outlooks
Oil hovered near its highs as the International Energy Agency forecasted demand would eclipse supply by 1.2 million barrels a day on average in H2. That follows a forecast from the Organization of Petroleum Exporting Countries that the fourth quarter may see the biggest deficit in over a decade.
West Texas Intermediate fluctuated near $89 a barrel, largely following equity market movements. Yet traders are bracing for a potential pullback. According to an Energy Information Administration report on Wednesday, US crude stockpiles rose by almost 4 million barrels last week.
Tech Leaders Discuss AI Policy in Closed-Door Senate Meeting
More than 20 tech and civil society leaders, organized by Senate Majority Leader Chuck Schumer, appeared at a closed-door Senate meeting on Wednesday to shape how artificial intelligence is regulated. The CEOs of $Alphabet-C(GOOG.US$, $Microsoft(MSFT.US$, $Meta Platforms(META.US$ and OpenAi were invited to appear alongside rivals and industry critics to discuss possible guardrails for AI that balance the risks and rewards of the technology.
Bloomberg reported Meta CEO Mark Zuckerberg, OpenAI CEO Sam Altman, and Microsoft co-founder Bill Gates offered diverging views on the risks of open-source AI research. $Tesla(TSLA.US$ CEO Elon Musk was also met with pushback downplaying concerns about AI-powered self-driving cars.
COMPANIES
Arm Set to Price IPO at $52 a Share
$Arm Holdings(ARM.US$ is preparing to price its shares at $52 apiece, as the British chip designer lays the groundwork for the biggest U.S. public offering of the year.
Moderna Poised to Seek Flu Shot Approval After Trial Results
$Moderna(MRNA.US$ gained after saying a reformulated version of its messenger-RNA-based flu shot met its primary goals in a final-stage trial — a result that could pave the way for the company to seek regulatory approval for the influenza vaccine.
Berkshire Hathaway Hits Trifecta With Record Stock Price and Market Cap, Beats S&P 500
$Berkshire Hathaway-A(BRK.A.US$ shares hit a record high Tuesday, its market value topped $800 billion and its performance has moved above that of the S&P 500 so far this year.
Caesars Entertainment Paid Millions to Hackers in Recent Attack
$Caesars Entertainment(CZR.US$ paid tens of millions of dollars to hackers who broke into the company’s systems in recent weeks. Sources revealed the leak after $MGM Resorts International(MGM.US$ reported a similar hack to the SEC.
Airlines Shares Slump Most in Two Months as American Cuts View
$Spirit Airlines(SAVE.US$ slipped after citing “steep” discounts for travel ahead of the Thanksgiving holiday, and also saying the surge in fuel — one of the industry’s highest costs — would hurt its quarterly results.
Source: Bloomberg, Dow Jones, CNBC
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