Wall Street Rises as Consumer Prices Increase Less Than Expected

Wall Street experienced a notable rise on Friday, fueled by recent government data indicating that inflation remains high yet rose less than anticipated last month. This development strengthens expectations for a potential interest rate cut from the Federal Reserve in their upcoming meeting.

Market Performance Overview

Futures for the S&P 500 increased by 0.7%, while the Dow Jones Industrial Average futures saw a 0.5% rise. Following the inflation report release, the yield on the 10-year Treasury bond fell, decreasing from 4.01% to 3.97%.

Consumer Price Index Insights

The delayed inflation report, released over a week later due to a government shutdown, showed consumer prices increased by 3% in September compared to a year ago, slightly up from 2.9% in August. Core prices, excluding food and energy, also saw a rise of 3%, down from 3.1% the previous month. These figures are still above the Federal Reserve’s target of 2%.

• The government shutdown, ongoing for four weeks, prompted the Trump administration to recall Labor Department personnel to produce these crucial figures.
• The report’s smaller-than-expected increase is likely to influence the Federal Reserve’s decision on an interest rate cut at next week’s meeting.

Oil and Commodity Prices

In the commodities market, oil prices increased, continuing a surge from the previous day. U.S. benchmark crude rose by 17 cents, reaching $61.96 per barrel. Meanwhile, Brent crude gained 25 cents to $66.24 per barrel.

Corporate Earnings Highlights

Intel’s stocks surged by 6.8% after exceeding Wall Street’s profit expectations in their third-quarter report. This was Intel’s initial earnings report since the announcement of a 10% government stake in the company. The semiconductor producer has been making cuts and delaying projects to stabilize its financial standing against competitors.

Ford Motor Co. also saw a significant stock increase of 4.4%. The automaker reported a 9% revenue growth from the prior year, achieving a record $50.5 billion.

Global Market Reactions

Gold prices fell by 1.7% to $4,075.10 per ounce, marking a rare dip in a year of rising prices. In European markets, Germany’s DAX saw a slight increase of 0.1%, while the FTSE 100 in Britain edged up less than 0.1%. However, France’s CAC 40 experienced a downturn of 0.3%.

Asian markets, including Chinese stocks, also showed gains following a significant party meeting that concluded without major policy shifts. Hong Kong’s Hang Seng index rose by over 0.7%, while the Shanghai Composite index increased by 0.7% as well. Japan’s Nikkei 225 rebounded by 1.4% after prior losses. Meanwhile, South Korea’s Kospi surged by 2.5%, reaching a record of 3,941.59 due to positive sentiment from Wall Street and news regarding the upcoming Trump-Xi summit.

Regional Insights

Australia’s S&P/ASX 200 saw a slight decline, dropping nearly 0.2% to 9,019.00 as preliminary data indicated a contraction in factory activity. In India, the BSE Sensex decreased by over 0.5%. Taiwan´s stock market remained closed for a holiday.