US close: Stocks rise as producer price inflation eases
US stocks put in solid gains on Thursday as investors assessed how slowing producer-price inflation would affect the near-term outlook for interest rates ahead of the Federal Reserve's next policy meeting.
The Dow finished 0.6% higher while the S&P 500 rose 0.8% and the Nasdaq jumped 1%, with the latter two indices recording their fourth consecutive days in positive territory.
In economic data, US producer price inflation slowed to a six-month low of 1.7% in August, from a revised 2.1% in July and slightly under the 1.8% expected by the market. Over the month, wholesale prices rose by 0.2% as anticipated.
Meanwhile, US initial jobless claims rose by 2,000 week-on-week to 230,000, well above average seen earlier in the year but in line with consensus forecasts.
"The data fits into the 'more encouraging' category of price data Federal Reserve officials have been looking for, but alongside a more benign employment report in August, we think incoming data supports a 25bps cut in September, and markets have recently moved closer in line with our view," said Matthew Martin, US economist at Oxford Economics.
"However, with nearly 100bps of cuts still pencilled in by year-end, we think expectations remain too aggressive," Martin added. The Federal Open Market Committee meeting will take place next Wednesday.
Market movers
Kroger shares popped 7% as investors digested the grocer’s updated guidance following a mixed second-quarter performance. Second-quarter sales were flat at $33.9bn, slightly behind the $34.1bn consensus forecast, but the company still raised its full-year sales growth guidance to 1.75% minus fuel, from 0.75% previously.
Shares in Moderna tumbled 12% after the biotech giaint detailed plans to cut its research budget by more than $1bn. The firm said it would focus on ten product approvals through 2027, but discontinue five programmes in its pipeline, as it looks to cut research and development expenses to around $3.6bn-$3.8bn.
Food manufacturer General Mills finished flat after announcing the split-up and sale of its North American yoghurt business to two French dairy companies in a $2.1bn deal.
Microsoft rose on reports that it is cutting 650 jobs from its video game division. According to a company email seen by The Wall Street Journal, the job cuts are not a result of closures or cancellations to any games, devices or studios – unlike May's layoffs when three studios were closed.
Mastercard edged higher on the news that it will buy cyber defence company Recorded Future, the world’s largest threat intelligence company, from Insight Partners for $2.65bn.
Dow Jones - Risers
Salesforce.Com Inc. (CRM) $253.37 1.52%
Caterpillar Inc. (CAT) $339.58 1.37%
3M Co. (MMM) $131.82 1.22%
Travelers Company Inc. (TRV) $234.00 1.17%
Walgreens Boots Alliance, Inc. (WBA) $8.84 1.09%
Home Depot Inc. (HD) $374.50 1.08%
Cisco Systems Inc. (CSCO) $49.63 1.06%
Walmart Inc. (WMT) $79.66 1.04%
Walt Disney Co. (DIS) $89.21 1.01%
Chevron Corp. (CVX) $139.21 0.96%
Dow Jones - Fallers
Intel Corp. (INTC) $19.35 -1.45%
Dow Chemical Co. (DOW) $50.29 -0.87%
Procter & Gamble Co. (PG) $173.28 -0.37%
JP Morgan Chase & Co. (JPM) $206.71 -0.25%
Johnson & Johnson (JNJ) $164.43 -0.24%
Unitedhealth Group Inc. (UNH) $588.66 -0.19%
Amgen Inc. (AMGN) $329.72 -0.08%
Dowdupont Inc. (DWDP) $0.00 0.00%
Nike Inc. (NKE) $78.42 0.03%
Apple Inc. (AAPL) $222.85 0.09%
S&P 500 - Risers
CenturyLink Inc. (LUMN) $5.97 9.83%
Under Armour Inc. Class A (UAA) $7.31 7.66%
Kroger Co. (KR) $55.13 7.05%
Under Armour, Inc. (UA) $6.88 6.17%
Vornado Realty Trust (VNO) $35.94 5.30%
Foot Locker Inc. (FL) $25.36 4.66%
Newmont Corporation (NEM) $52.90 4.27%
eBay Inc. (EBAY) $63.19 4.05%
Broadcom Inc. (AVGO) $164.61 4.01%
Arista Networks Inc. (ANET) $355.36 3.62%
S&P 500 - Fallers
Wells Fargo & Co. (WFC) $51.57 -4.02%
Micron Technology Inc. (MU) $87.21 -3.79%
Texas Instruments Inc (TXN) $196.04 -3.15%
Fortinet Inc. (FTNT) $74.51 -2.78%
Charles Schwab Corp. (SCHW) $61.70 -2.69%
Lam Research Corp. (LRCX) $747.80 -2.48%
KLA-Tencor Corp. (KLAC) $733.30 -2.07%
US Bancorp (USB) $43.85 -2.01%
Seagate Technology Plc (STX) $100.54 -1.94%
Microchip Technology Inc. (MCHP) $76.10 -1.74%
Nasdaq 100 - Risers
Mercadolibre Inc. (MELI) $2,138.02 4.50%
eBay Inc. (EBAY) $63.19 4.05%
Broadcom Inc. (AVGO) $164.61 4.01%
Charter Communications Inc. (CHTR) $338.91 3.51%
Gilead Sciences Inc. (GILD) $83.15 2.74%
Meta Platforms Inc. (META) $525.67 2.70%
DENTSPLY Sirona Inc. (XRAY) $25.40 2.69%
Alphabet Inc. Class A (GOOGL) $154.71 2.35%
Qurate Retail Inc. (QRTEA) $0.51 2.27%
Alphabet Inc. Class C (GOOG) $155.59 2.26%
Nasdaq 100 - Fallers
Sirius XM Holdings Inc (SIRI) $25.54 -9.78%
Micron Technology Inc. (MU) $87.21 -3.79%
Texas Instruments Inc (TXN) $196.04 -3.15%
Lam Research Corp. (LRCX) $747.80 -2.48%
KLA-Tencor Corp. (KLAC) $733.30 -2.07%
Seagate Technology Plc (STX) $100.54 -1.94%
Workday, Inc. (WDAY) $251.06 -1.78%
Microchip Technology Inc. (MCHP) $76.10 -1.74%
Analog Devices Inc. (ADI) $221.55 -1.56%
Applied Materials Inc. (AMAT) $183.24 -1.45%