Dow Jones gains ground as CPI drops to 2.5 percent

NEW YORK, New York – Prices of U.S. stocks swelled on Wednesday following the release of the latest CPI showing inflation running at an annualised 2.5 percent. This was against expectations of 2.6 percent.

The Consumer Price Index for All Urban Consumers in August increased 0.2 percent on a seasonally adjusted basis, the same increase as in July, the U.S. Bureau of Labor Statistics reported Wednesday. “Over the last 12 months, the all items index increased 2.5 percent before seasonal adjustment,” the report said.

The full CPI report is reproduced at the end of this article.

All the major indices closed higher on Wednesday, showing strong performance across key sectors, with the Nasdaq outperforming with a more than two-per-cent rally.

Gains were observed in the S&P 500, and Dow Jones as well, driven by investor optimism and active trading.

The S&P 500 (^GSPC) closed at 5,554.13 points, up by 58.61 points or 1.07 percent. Trading volume for the index was notably high, with 2.779 billion shares traded.

The Dow Jones Industrial Average (^DJI) also saw an uptick, closing at 40,861.71 points, an increase of 124.75 points or 0.31 percent. The total volume of shares traded for the Dow was 352.922 million.

The NASDAQ Composite (^IXIC) experienced the most significant gain, closing at 17,395.53 points, rising by 369.65 points or 2.17 percent. The trading volume was particularly robust, with 5.228 billion shares traded.

U.S. dollar shoots higher on CPI report

In the currency markets, the U.S. Dollar Index inched up by 0.08 points, or 0.08 percent, to 101.71, while most currencies fell as dis expectations for a 50 basis points Fed rate cut when the monetary committee meets on 18 September.

Only the safe-haven currency, the Japanese yen, and surprisingly, the Australian and Canadian dollars, edged higher.

The Euro/US Dollar (EUR/USD) pair remained slightly lower at 1.1018, reflecting a flat performance with little movement recorded for the day.

The US Dollar/Japanese Yen (USD/JPY) pair declined slightly, with the dollar losing 0.18 percent against the yen. The pair fell to 142.16, as investors weighed global economic uncertainties.

In the North American market, the US Dollar/Canadian Dollar (USD/CAD) pair also experienced a drop, with the dollar slipping by 0.23 percent to 1.3578 against the Canadian dollar. This decline reflects continued strength in the Canadian dollar driven by commodity price fluctuations.

Meanwhile, the British Pound/US Dollar (GBP/USD) pair fell by 0.27 percent, to 1.3044. The pound weakened against the dollar amidst ongoing concerns about the UK’s economic outlook.

Conversely, the US Dollar/Swiss Franc (USD/CHF) pair saw a notable rise, with the dollar strengthening by 0.43 percent, to 0.8505. This reflects strong demand for the dollar amid safe-haven flows.

In the Australian market, the Australian Dollar/US Dollar (AUD/USD) pair edged higher, rising by 0.18 percent to close at 0.6664.

In New Zealand, the New Zealand Dollar/US Dollar (NZD/USD) pair saw a decline, with the Kiwi falling by 0.31 percent, to 0.6130 against the dollar, as global risk sentiment weighed on the currency.

Global Stock Market Roundup: Mixed Performances on Wednesday

On Wednesday, stock markets across the globe closed with mixed results as investors navigated varied economic data and market conditions. Below is a summary of key indices and their movements:

CANADA

In Canada, the S&P/TSX Composite Index (^GSPTSE) followed the upward trend, closing at 23,211.17 points, gaining 208.08 points or 0.90 percent. The volume for the S&P/TSX was 264.405 million.

UNITED KINGDOM

In London, the FTSE 100 dropped by 12.04 points, or 0.15 percent, closing at 8,193.94.

EUROPE

Germany’s DAX Performance-Index climbed 64.35 points, or 0.35 percent, finishing at 18,330.27.

In France, the CAC 40 slipped by 10.72 points, or 0.14 percent, ending at 7,396.83.

The broader Euro Stoxx 50 rose by 16.38 points, or 0.35 percent, to close at 4,763.58.

The Euronext 100 Index also increased, gaining 4.20 points, or 0.29 percent, to close at 1,450.28.

Belgium’s BEL 20 saw a minor dip of 1.59 points, or 0.04 percent, closing at 4,195.75.

ASIA

In Asia, the Hang Seng Index dropped by 125.38 points, or 0.73 percent, closing at 17,108.71.

In China, the SSE Composite Index dropped by 22.40 points, or 0.82 percent, to close at 2,721.80.

Japan’s Nikkei 225 saw a significant decline of 539.39 points, or 1.49 percent, ending at 35,619.77.

In Singapore the STI Index rose by 18.50 points, or 0.53 percent, to close at 3,531.17.

In India, the S&P BSE Sensex dropped by 398.13 points, or 0.49 percent, closing at 81,523.16.

The IDX Composite in Indonesia saw a slight dip of 0.43 points, or 0.01 percent, ending at 7,760.96.

Malaysia’s FTSE Bursa Malaysia KLCI fell by 20.55 points, or 1.24 percent, closing at 1,639.80.

In South Korea the KOSPI Composite Index decreased by 10.06 points, or 0.40 percent, finishing at 2,513.37.

Taiwan’s TSEC Weighted Index dropped by 33.08 points, or 0.16 percent, to close at 21,031.00.

OCEANIA

In Australia, the S&P/ASX 200 declined by 24.00 points, or 0.30 percent, ending at 7,987.90, while the All Ordinaries fell by 21.80 points, or 0.27 percent, to finish at 8,195.20.

In New Zealand, the S&P/NZX 50 edged down by 0.47 points, or nearly 0 percent, closing at 12,632.35.

MIDDLE EAST

In the Middle East, Israel’s TA-125 rose by 2.21 points, or 0.11 percent, closing at 2,033.28. Egypt’s EGX 30 Price Return Index surged by 381.30 points, or 1.27 percent, to close at 30,485.60 with a trading volume of 167.442 million.

AFRICA

In South Africa, the Top 40 USD Net TRI Index fell by 53.14 points, or 1.20 percent, closing at 4,384.68.

Full CPI Report – published Wednesday 11 September 2024:

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent on a seasonally adjusted basis, the same increase as in July, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.5 percent before seasonal adjustment. The index for shelter rose 0.5 percent in August and was the main factor in the all items increase. The food index increased 0.1 percent in August, after rising 0.2 percent in July. The index for food away from home rose 0.3 percent over the month, while the index for food at home was unchanged. The energy index fell 0.8 percent over the month, after being unchanged the preceding month. The index for all items less food and energy rose 0.3 percent in August, after rising 0.2 percent the preceding month. Indexes which increased in August include shelter, airline fares, motor vehicle insurance, education, and apparel. The indexes for used cars and trucks, household furnishings and operations, medical care, communication, and recreation were among those that decreased over the month. The all items index rose 2.5 percent for the 12 months ending August, the smallest 12-month increase since February 2021. The all items less food and energy index rose 3.2 percent over the last 12 months. The energy index decreased 4.0 percent for the 12 months ending August. The food index increased 2.1 percent over the last year.

Food The food index increased 0.1 percent in August, after rising 0.2 percent in each of the previous 2 months. The index for food at home was unchanged in August. Two of the six major grocery store food group indexes increased over the month while the other four indexes declined in August. The index for meats, poultry, fish, and eggs rose 0.8 percent in August as the index for eggs increased 4.8 percent. The dairy and related products index increased 0.5 percent over the month. The nonalcoholic beverages index fell 0.7 percent in August, after rising 0.5 percent in July. The index for other food at home decreased 0.3 percent over the month, the index for fruits and vegetables declined 0.2 percent, and the index for cereals and bakery products fell 0.1 percent in August. The food away from home index rose 0.3 percent in August, after rising 0.2 percent in July. The index for limited service meals rose 0.3 percent and the index for full service meals increased 0.2 percent over the month. The index for food at home rose 0.9 percent over the last 12 months. The meats, poultry, fish, and eggs index rose 3.2 percent over the last 12 months and the nonalcoholic beverages index increased 1.3 percent. Over the same period, the index for other food at home rose 0.4 percent, as did the index for dairy and related products. In comparison, the cereals and bakery products index fell 0.3 percent over the year and the fruits and vegetables index decreased 0.2 percent. The food away from home index rose 4.0 percent over the last year. The index for limited service meals increased 4.3 percent over the last 12 months and the index for full service meals rose 3.8 percent over the same period. Energy The energy index decreased 0.8 percent in August, after being unchanged in July. The gasoline index fell 0.6 percent over the month. (Before seasonal adjustment, gasoline prices decreased 2.7 percent in August.) The electricity index decreased 0.7 percent over the month and the natural gas index fell 1.9 percent in August. The energy index decreased 4.0 percent over the past 12 months. The gasoline index fell 10.3 percent over this 12-month span, and the natural gas index declined 0.1 percent. The index for fuel oil fell 12.1 percent over the same period. In contrast, the index for electricity increased 3.9 percent over the last 12 months. All items less food and energy The index for all items less food and energy rose 0.3 percent in August, after rising 0.2 percent in July. The shelter index increased 0.5 percent in August. The index for owners’ equivalent rent rose 0.5 percent over the month and the index for rent increased 0.4 percent. The lodging away from home index rose 1.8 percent in August, after rising 0.2 percent in July. The airline fares index rose 3.9 percent in August, after declining in each of the previous 5 months. The index for motor vehicle insurance increased 0.6 percent over the month. The indexes for education and apparel also increased in August. The index for used cars and trucks fell 1.0 percent in August, following a 2.3-percent decrease in July. Over the month, the household furnishings and operations index fell 0.3 percent. The medical care index fell 0.1 percent in August, after falling 0.2 percent in July. The communication index decreased 0.1 percent in August, as did the recreation index and the personal care index. The index for new vehicles was unchanged over the month. The index for all items less food and energy rose 3.2 percent over the past 12 months. The shelter index increased 5.2 percent over the last year, accounting for over 70 percent of the total 12-month increase in the all items less food and energy index. Other indexes with notable increases over the last year include motor vehicle insurance (+16.5 percent), medical care (+3.0 percent), recreation (+1.6 percent), and education (+3.1 percent). Not seasonally adjusted CPI measures The Consumer Price Index for All Urban Consumers (CPI-U) increased 2.5 percent over the last 12 months to an index level of 314.796 (1982-84=100). For the month, the index increased 0.1 percent prior to seasonal adjustment. The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) increased 2.4 percent over the last 12 months to an index level of 308.640 (1982-84=100). For the month, the index was unchanged prior to seasonal adjustment. The Chained Consumer Price Index for All Urban Consumers (C-CPI-U) increased 2.4 percent over the last 12 months. For the month, the index increased 0.1 percent on a not seasonally adjusted basis. Please note that the indexes for the past 10 to 12 months are subject to revision.