The Dow was up more than 300 points, with all stocks rebounding. in response to the lower than expected producer price index (PPI). This indicates that US inflation has reached its peak. And it will be a support factor for the Federal Reserve (Fed) to slow down the rate hike.
As of 21:31 Thai time, the Dow Jones Industrial Average was 33,891.28 points, up 354.58 points or 1.05%.
Equity markets also benefited from the weakness of the dollar and the decline in US Treasury yields. following the release of the PPI today
The depreciation of the dollar will increase the profits of listed companies that earn from abroad. In regards to the decline in the yield on the 10-year US Treasury, which is the US treasury used as a benchmark to price bonds around the world. This includes the US mortgage interest rate. it will give consumers more money to spend AND help reduce the cost of repaying various companies’ debt. enabling these companies to increase their investments and increase dividend payments to investors
Investors expect The Fed to raise interest rates by just 0.50% at its December monetary policy meeting. after revealing lower-than-expected inflation numbers
CME Group’s FedWatch tool shows investors weigh 80.6% that the Fed will hike interest rates by 0.50% at its Dec. 13-14 meeting and 19.4% that the Fed will hike US rates 0.75%.
The US Department of Labor has released PPI, a measure of inflation on manufacturers’ spending. Month of October today, with the aforementioned PPI number below analyst expectations. This indicates that US inflation has reached its peak.
Core PPI, which includes food and energy, rose 8.0% in October year-on-year. This was below analyst expectations by 8.3% and down from 8.4% in September.
Month-on-month, the headline PPI rose 0.2% in October, below analyst expectations by 0.4% from 0.2% in September.
Core PPI, which excludes food and energy, rose 5.4% in October year-over-year. down from 5.6% in September.
On a month-on-month basis, core PPI rose 0.2% in October from 0.3% in September.
The market was also buoyed by the strong earnings release from Wal-Mart.
company walmart which is the world’s largest retail company Reported earnings and revenue for the third quarter exceeded analysts’ expectations.
Walmart reported earnings of $1.50 per share, above analyst expectations of $1.32 per share.
Meanwhile, the company’s revenue was $152.81 billion. This was above analyst expectations by $147.75 billion.
