May 13 2024: U.S. stocks saw slight gains on Monday as they traded within narrow ranges ahead of the impending release of crucial inflation data later in the week. These data points are anticipated to heavily influence the market’s outlook regarding interest rates.
As of 09:35 ET (13:35 GMT), the Dow Jones Industrial Average increased by 75 points, equivalent to a 0.2% rise, while the S&P 500 climbed 13 points, marking a 0.3% increase, and the NASDAQ Composite gained 58 points, or 0.4%.
Last week, major Wall Street indices recorded three consecutive weeks of gains, buoyed by robust earnings reports and the potential for future interest rate cuts within the year.
According to FactSet data, over 90% of S&P 500 companies had reported their results as of Friday, with nearly 80% surpassing analysts’ forecasts.
Market Focus on Inflation Data:
The focus for the market is now turning towards the upcoming key producer price index and consumer price index inflation readings scheduled for Tuesday and Wednesday, respectively.
Investors are particularly attentive to any signs of cooling inflation after the unexpected rise in price pressures during the first quarter of 2024, which had tempered hopes for early interest rate cuts.
Even if the inflation data this week indicates some moderation, it is expected to remain significantly above the Federal Reserve’s 2% annual target, potentially delaying any immediate plans for rate cuts.
Additional signals from Fed officials are anticipated, with Cleveland Fed President Loretta Mester scheduled to speak on Monday, following concerns raised by several peers last week regarding the need for greater confidence in easing inflation before contemplating rate adjustments.
Arm’s AI Plans Propel Stock:
Arm Holdings experienced a 4% surge after announcing its intentions to develop artificial intelligence chips. The company plans to establish an AI chip division, aiming to build a prototype by spring 2025, with mass production likely starting in the autumn of 2025.
Other Market Highlights:
Intel rose 1% following reports of advanced talks with Apollo Global Management for an $11 billion chip plant in Ireland.
Tesla gained 0.9% amid news that President Joe Biden is set to announce new China tariffs targeting various sectors, including electric vehicles.
Crude Oil Reactions:
Crude oil prices saw a slight uptick after digesting mixed inflation data from China, the world’s largest crude importer, ahead of crucial U.S. inflation readings later in the week. These developments are influencing trading sentiments amid concerns over economic cooldowns in major fuel-consuming nations.
