Investing.com — The S&P 500 closed lower Thursday after stronger-than-expected inflation data clouded the outlook for Federal Reserve rate cuts.
At 15:02 ET (2002 GMT), the price was down 151 points, or 0.4%, down 0.4% and down 0.2%.
CPI data comes amid hot, cooling bets on big rate cuts
U.S. headline inflation slowed year-on-year in September but was still faster than expected, giving the Federal Reserve less incentive to cut rates at a rapid pace.
The (CPI) was 0.2% in September, unchanged from August, but above the expected 0.1%. That brought the annual pace through August to 2.4%, down from 2.5% in August but above expectations of 2.3%.
The core CPI, which excludes food and energy and is closely watched by the Fed, rose 0.3%, bringing the annual pace through September to 3.3%, beating economists’ estimates from 2 exceeds .3%.
“With a further focus on inflation, investors seem to be too “recalibrate” their outlook for rate cuts, lowering expectations for a second round of excessive 50 bp cuts in November and pushing 10-year yields back above 4% for the first time since July,” Stifel said in a note. Thursday.
As the Fed’s speech continued, comments from Atlanta Fed President Raphael Bostic were notable. Bostic said Thursday he is open to a quarter-point rate cut or may even support an unchanged decision if the recent bout of stronger inflation and the labor market continues.
Banks start third quarter earnings season; Delta relies on guidance
The focus this week is also on the third quarter earnings season, with a series of major banks set to report on Friday.
JPMorgan Chase (NYSE:), Wells Fargo (NYSE:) and Bank of New York Mellon (NYSE:) will report third-quarter earnings on Friday, while Goldman Sachs (NYSE:), Bank of America (NYSE:) and Citi Group (NYSE:) will report earnings next week.
Earnings from Johnson & Johnson (NYSE:), Unitedhealth Group (NYSE:) and Walgreens Boots (NASDAQ:) are also expected early next week.
Ahead of that, shares of Delta Air Lines (NYSE:) fell 0.3% after the airline reported current quarter earnings estimates that exceeded analyst expectations as the company grapples with the fallout from a summer computer network outage and the price pressure due to overcapacity.
The company said it now expects fourth-quarter adjusted earnings per share of between $1.60 and $1.85, missing Wall Street estimates of $1.78 in the middle, according to Bloomberg News.
Tesla robotaxi event with eyes; GXO is reportedly considering a sale; AMD drops as AI event kicks off
GXO Logistics Inc (NYSE:) gained more than 14% after Bloomberg reported, based on unnamed sources, that the company was considering a sale. However, the report suggested that no decision has yet been made.
Tesla Inc (NASDAQ:) fell 1% as investors waited for the EV maker to unveil its robotaxi at an event on Thursday.
Advanced Micro Devices Inc (NASDAQ:), meanwhile, fell 4% as the chipmaker kicked off its artificial intelligence event to showcase its latest plans, including new chips to compete with rival Nvidia (NASDAQ:).
AMD said Thursday it plans to ramp up production of its new artificial intelligence M1325X chip starting in the fourth quarter. The chipmaker also unveiled a new server chip and announced a new AI chip that will be released in the second half of next year.
(Peter Nurse, Ambar Warrick contributed to this article.)
