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US shares open higher as inflation drops
DJIA up 0.08% (Il Sole 24 Ore Radiocor) - New York, 11 Jul - US shares opened slightly higher after key data showed inflation had fallen more than expected in June, rekindling hopes of an interest rate cut this year.
The consumer-price index fell for the first time since 2020 last month, sliding 0.1% from the previous month and coming in below expectations for a 0.1% growth. On the year prices grew 3.0% compared to forecasts for 3.1%.
Core prices, which exclude volatile food and energy items, climbed 3.3% on the year, below estimates of 3.4%.
The Federal Reserve has acknowledged progress in bringing down inflation towards its 2% target rate but has cautioned it wants to see more evidence the easing is sustainable before it starts to cut rates.
In his two days of Congress testimony earlier this week Fed chair Jerome Powell reiterated the mantra while adding a softening jobs market signalled less pricing-pressure to worry over.
According to the CME FedWatch Tool, the market is now pricing in a 91% chance the Fed cuts rates in September compared to a 75% chance just a day ago.
On the stocks front, shares in PepsiCo were down 1.9% in early trade after its second-quarter revenue missed expectations while Delta Air Lines fell almost 10% after missing earnings estimates.
Just after the opening bell the Dow Jones was up 33.24 points, or 0.08%, at 39,754.60, the S&P 500 was up 2.41 points, or 0.04%, at 5,636.32 while the Nasdaq was up 11.50 points, or 0.06%, at 18,658.95.
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(RADIOCOR) 11-07-24 15:39:30 (0465) 5 NNNN