PiCK
New York Stocks Rebound After Five-Day Slide as Oil Falls, August CPI Meets Forecasts
Summary
- New York stocks rebounded after five trading days, helped by a drop in international oil prices and an August CPI reading that matched market expectations.
- The market read the August CPI and core CPI as broadly in line with forecasts, but expectations for additional Fed tightening strengthened instead.
- CME FedWatch showed an 86% chance of a 0.25 percentage-point rate increase at this FOMC meeting, while short-term Treasury yields continued to rise.
Forecast Trend Report by Period
New York stocks rebounded after five trading days of losses on September 11, helped by falling oil prices and a U.S. consumer price index reading that matched market expectations.
On the New York Stock Exchange, the Dow Jones Industrial Average rose 509.19 points, or 0.98%, to close at 52,573.29. The S&P 500 gained 0.86% to 7,656.98, while the Nasdaq Composite advanced 0.96% to end at 26,333.04.
Investor sentiment improved as oil prices, which had recently pressured equities, retreated. Brent crude for November delivery fell 2.8% to $104.61 a barrel, its first decline in six sessions. West Texas Intermediate crude for October delivery dropped 2.4% to settle at $100.05 a barrel, snapping a nine-session winning streak.
U.S. inflation data for August also eased some market concerns. The CPI rose 0.4% from a month earlier and 3.4% from a year earlier, broadly in line with expectations. Core CPI, which excludes food and energy, increased 0.3% from the previous month, above the 0.2% forecast.
While the inflation report did not deviate significantly from forecasts, expectations for additional Federal Reserve tightening strengthened. CME FedWatch showed the probability of a 25-basis-point rate increase at the Federal Open Market Committee meeting on September 15-16 climbed above 86% during the session.
Short-term Treasury yields also rose as concerns over monetary policy persisted. The U.S. two-year Treasury yield reached its highest intraday level since July 2024. Still, the drop in oil prices helped ease fears of renewed inflation, allowing stocks to absorb the pressure from higher yields and finish higher.
