S&P 500 closes up, win streak at 5; Alphabet weighs on Nasdaq
Kellanova jumps after Mars to buy co in $36 bln deal
U.S. CPI rises as expected in July
Alphabet dips after report US mulls Google break-up
Updates to close
By David French
Aug 14 (Reuters) -The S&P 500 closed higher on Wednesday, stretching its winning streak to five sessions, as the latest inflation data reassured investors betting the Federal Reserve would start cutting U.S. interest rates next month.
However, Alphabet and some megacap tech stocks traded lower, which weighed on the Nasdaq composite, which finished close to unchanged.
Moves were generally subdued though, with many investors away for August vacations, and new triggers for trading were absent, contributing to an overall listless picture among the benchmarks.
The latest U.S.consumer price data, released earlier on Wednesday, offered little for anyone seeking divergence from the expected path to a September start to interest rate cuts.
U.S. consumer prices rose moderately in July, and the annual increase in inflation slowed to below 3% for the first time since early 2021.
Coming the day aftersofter-than-expected producer prices data indicated inflation continued to moderate, although not yet all the way to the U.S. central bank's 2% target, supported the view inflation was being tamed.
Money markets now see a 55% chance of a 25-basis point (bps) rate cut at the Fed's Sept. 17-18 meeting, as per the CME FedWatch Tool. Before the data, traders were nearly evenly split between a 25-bps and 50-bps cut.
Scott Ladner, chief investment officer at Horizon Investments, said he called days such as this "markets violently going nowhere", adding with CPI painting a similar picture to PPI data, there was no reason for traders to reassess moves put in place on the previous day.
"There's no huge rationale to move prices one way or another," he said.
Unofficially, the S&P 500.SPX closed at 5,455.21, up 0.38% or 20.78 points. The Nasdaq .IXIC composite closed at 17,192.60, up 0.03% or 4.99 points. The Dow Jones Industrial Average .DJI closed up 242.75 points or 0.61% at 40,008.39.
Shares of Alphabet,the Google-parent GOOGL.O, dropped on amedia report that theU.S. Department of Justice is considering options that include breaking up the online search engine.
Other megacaps were mixed: Tesla TSLA.O and Meta Platforms dropped, while Microsoft MSFT.O and Nvidia NVDA.O rose.
A rebound in megacap and tech stocks has helped markets recoup most losses from a global market rout early this month after data showed the U.S. unemployment rate surged in July.
Thursday's release by the Commerce Department's Census Bureau of retail sales data will be keenly watched by those concerned about the overall strength of the American economy, Horizon's Ladner said.
These worries had sent theCboe volatility index .VIX, Wall Street's fear gauge, to its highest since 2020 just last week. However, on Wednesday, itstayed below its long term average of 20 points for the second day.
A majority of the major S&P sectors were in positive territory, led by a rise in financials .SPSY. Its advance was aided by gains by Progressive PGR.N and Charles Schwab SCHW.N, which rose after positive July performance numbers, and Allstate ALL.N, which climbed after agreeing to sell a business unit.
Kellanova K.N surged after family-owned candy giant Mars said it would buy the Cheez-It and Pringles maker in a nearly $36 billion deal.
Cardinal Health CAH.N gained after the drug distributor raised its 2025 profit forecast.
Reporting by Medha Singh and Shashwat Chauhan in Bengaluru and David French in New York; Editing by Maju Samuel and David Gregorio
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
