- US stocks reach new record highs for fourth consecutive day
- Wholesale prices drop by 0.2% in May
- Fed hold rates at 5.5%
4.05pm: Tech stocks higher in afternoon trading
US stocks reached record highs on Thursday, driven by cooling inflation and expectations of a Federal Reserve pause on interest rate cuts.
The S&P 500 closed over 0.2% higher and the Nasdaq Composite gained about 0.3%, marking the fourth consecutive record close for both indices. The Dow Jones was an outlier, finishing around 0.2% lower.
Despite the Federal Reserve scaling back its rate cut projections from three to one, investors remain optimistic, anticipating two cuts starting in September. The producer price index for May fell by 0.2%, indicating easing inflation.
Tesla's stock surged by 3% following shareholder approval of a $56 billion pay package for CEO Elon Musk. Additionally, a 12% increase in Broadcom shares and a 3% rise in Nvidia boosted the tech sector, with Microsoft and Apple also hitting record highs.
“Tech stocks are higher in afternoon trading, but then the Nasdaq 100 has been a rare island of bullishness in a generally negative week for equity markets," IG's Chris Beauchamp commented.
"The S&P 500 has only suffered minor losses, thanks of course to its tech contingent.”
Beauchamp went on to add that "followers of the Dow Jones will be hoping that index’s committee gets its act together and includes Nvidia to help the index play catch-up. But yesterday’s cautious Fed meeting and ongoing political worries in Europe continue to put pressure on equity markets generally.”
9.49am: US stocks flat at the open
Wall Street has gotten off to a mixed start today, with markets digesting the latest set of economic data, which indicated that inflation is slowing.
The Dow Jones dropped by 120 points or 0.3% to 38,591, while the Nasdaq lifted 0.65% or 114 points to 17,724.
Meanwhile, the S&P 500 rose 0.26% or 13 points to 5,435.
It comes after May's producer price index, which tracks the rises in wholesale prices, dropped by 0.2%, beating guidance for a 0.1% rise.
In equities, Broadcom shares opened close to 14% higher after it beat second-quarter estimates and announced a 10-1 stock split.
Dave & Buster's Entertainment dropped around 7% after it missed revenue guidance in its quarterly update.
8.44am: Wall Street set for mixed session as wholesale prices fall
US stocks are expected to have a mixed day of trading, according to premarket futures, with markets still weighing up the impact of the Federal Reserve's interest rate decision and a cooler-than-expected inflation print.
As expected the Fed kept interest rates at 5.5%, but opened the door for a possible rate cut later this year, buoyed by May's inflation data coming in below consensus.
"With most members split between one or two cuts we wouldn’t be surprised to see market pricing continue to flirt with multiple rate cuts this year,” said James McCann at abrdn.
This morning, markets recieved another boost on the route to rate cuts after wholesale prices dropped unexpectedly in May.
The producer price index, which measures the rise in wholesale prices, declined by 0.2% in May, switching from the 0.5% rise in April and beating out consensus forecasts of a 0.1% jump.