US stocks slip as hot inflation print ends 5-week win streak
US stocks slipped lower on Friday after a hot inflation print capped off a week of key data points.
The S&P 500 dipped 0.27% over the past five days, ending a 5-week win streak.
"Indeed, [the PPI data] has aligned the Fed's projected rate path with the market's, as investors are now pricing in just three cuts this year."
The stock market slipped on Friday after hot inflation capped off a busy week of economic data prints.
The Producer Price Index came in higher than expected, showing a 0.3% increase in prices from December, with a year-over-year increase of 0.9%. That's after hot CPI data rolled in earlier this week.
Even though the market recovered from Tuesday's hiccup, investor gloom has knocked stocks off a 5-week win streak. The S&P 500 is down 0.27% in the past 5 days, while the Nasdaq is down 1.02%.
This week also saw retail sales data slide lower, down 0.8% from a month earlier in January.
These data points highlight a robust economy, but mean a Fed rate cut is farther out than markets were hoping. On Thursday, Atlanta Fed president Raphael Bostic said he's not convinced that inflation is definitely headed toward the central bank's 2% target.
After the PPI data came out, odds that the Fed would hold rates where they are during their May meeting jumped another 10%, according to the CME FedWatch Tool.
"Indeed, this [inflation] report has aligned the Fed's projected rate path with the market's, as investors are now pricing in just three cuts this year; earlier this year, they had expected seven," said José Torres, Senior Economist at Interactive Brokers. "The sharp adjustment in expectations has yet to affect equities in a meaningful way, however, with bullish sentiment and better-than-expected earnings reports providing robust support."
Here's where US indexes stood at the closing bell at 4:00 p.m. on Friday:
S&P 500: 5,00.55, down 0.38%
Dow Jones Industrial Average: 38,627.99, down 0.37% (-145.13 points)
Nasdaq Composite: 15,775.65, down 0.82%
Here's what else is going on:
The market could fall 5% in an 'air-pocket drawdown' as greedy traders short volatility, a research firm said.
The death of oil demand has been exaggerated and supply won't be able to keep up without more investment, according to Morningstar.
A recession, investor FOMO, and inflation are threatening the stock market's red-hot rally.
The data that powered the stock market rally is reversing and it's still possible the Fed raises rates before it cuts, one market vet said.
Wall Street's excitement about Nvidia has reached a fever pitch as its valuation soars.
In commodities, bonds, and crypto:
Oil prices rose, with West Texas Intermediate up 1.51% to $79.21 a barrel. Brent crude, the international benchmark, was also up 0.63% to $83.38 a barrel.
Gold edged up 0.41% to $2,023.20 per ounce.
The 10-year Treasury yield climbed 5.9 basis points to 4.299%.
Bitcoin went up 0.2% to $51,809.75.
Read the original article on Business Insider
