Stock market today: Wall Street opens higher after cooler reading on inflation
By Joe Mcdonald And Matt Ott, The Associated Press on June 13, 2023.
NEW YORK (AP) – Stocks are opening higher after a cooler reading on inflation bolstered Wall Street’s expectations for the Federal Reserve to hold off on raising interest rates again this week. The S&P 500 was 0.4% higher in early trading Tuesday, pushing further into heights it hasn’t touched since April 2022. The Dow edged up 50 points, or 0.1%, and the Nasdaq composite rose 0.7%. Stocks have been on a roll amid hopes the economy can avoid a severe recession and inflation will ease. Yields fell in the bond market as traders amped up bets for the Fed to announce no change to interest rates on Wednesday. THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below. Wall Street inched modestly higher early Tuesday after new data showed that consumer prices in the United States cooled last month, though some underlying price pressures remained elevated. Futures for the S&P 500 ticked up 0.4% before the bell Tuesday, while the Dow Jones Industrial Average rose 0.2%. Oil prices rebounded from a 3% decline Monday. Consumer prices rose just 0.1% from April to May, the government said Tuesday, extending a year-long easing of prices. Measured year over year, inflation slowed to just 4% in May – the lowest 12-month figure in over two years and well below April’s 4.9% annual rise. Tuesday’s inflation figures arrive just as Fed officials begin a pivotal two-day meeting, where they’re expected to leave interest rates alone after imposing 10 straight rate hikes since March 2022. On Wednesday, the central bank will likely announce that it’s skipping a rate hike but may hint that it will resume raising rates as soon as July. The Fed’s benchmark lending rate is at a 16-year high, which has led to a contraction in manufacturing activity and three high-profile bank failures. “The bull market rally looks like it doesn’t want to stop,” said Edward Moya of Oanda in a report. “Wall Street appears confident that the Fed will not be delivering its 11th straight rate hike this week.” Two Fed board members have said the Fed should hold off on a rate increase this week while it gathers data on the impact of previous hikes. Central banks in Europe and Japan also are due to meet this week to discuss possible rate hikes. In Europe at midday, the FTSE 100 in London rose 0.1% and the CAC 40 in Paris advanced 0.3%. The DAX in Frankfurt gained 0.4%. In Asia, the Shanghai Composite Index gained 0.2% to 3,233.67 after China’s central bank lowered its one-week lending rate for the first time since last summer. That appeared to reflect official concern about the health of China’s economic recovery after growth in factory and consumer activity weakened. In premarket trading, Bunge dipped close to 2% after it announced it was buying Netherlands-based Viterra in a deal worth $18 billion that would create a global agricultural giant. Viterra shareholders will receive about 65.6 million shares of Bunge stock – valued at approximately $6.2 billion – and about $2 billion in cash. Bunge will assume $9.8 billion of Viterra debt. The Nikkei 225 in Tokyo surged 1.8% to 33,018.65 and the Hang Seng in Hong Kong advanced 0.6% to 19,521.42. The Kospi in South Korea added 0.3% to 2,637.95 and Sydney’s S&P-ASX 200 was 0.2% higher at 7,138.90. New Zealand and Bangkok advanced. Singapore and Jakarta declined. In energy markets, benchmark U.S. crude rose $1.38 to $68.50 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $3.05 on Monday to $67.12. Brent crude, the price basis for international oil trade, gained $1.62 to $73.46 per barrel in London. It lost $2.95 the previous session to $71.84. The dollar fell to 139.19 yen from Monday’s 139.62 yen. The euro advanced to $1.0812 from $1.0756. Wall Street’s benchmark S&P 500 index rose 0.9% on Monday to a 14-month high. High-growth stocks, seen by investors as some of the biggest beneficiaries of lower rates, led the market. Tech stocks alone accounted for more than half the S&P 500’s gain. – – McDonald reported from Beijing; Ott reported from Silver Spring, Md. 22-21
