Wall Street rallied after a better-than-expected July CPI report.
For July’s CPI, market experts expected a 0.2% increase from the previous month. This figure mirrors the rate of growth observed in June. This might not seem like a significant jump, but this kind of incremental shift can have far-reaching implications.
But the story doesn’t end there. On a year-over-year (Y/Y) basis, the CPI is projected to swell to 3.3%, up from the 3.0% recorded in June. Now, why is this annual figure so important? It’s a reflection of the price changes over an entire year. The increase from 3.0% to 3.3% might seem small initially, but it signifies a significant uptick in inflation.
By 8:30 a.m. ET, the Bureau of Statistics had released the inflation report for July. The report came in better than previous market expectations. The report shows a slowdown in the inflation acceleration speed. On a monthly basis, consumer index prices remain steady at 0.2%. From the yearly estimation, the CPI was down by 0.1 from the previous market education of 3.3%, making the indexes rise by 3.2%.
The core CPI, excluding volatile elements like food and energy, remained steady with a 0.2% monthly increase. On a yearly basis, the core index grew by 4.7%, slightly below the expected rise of 4.8%. This stability suggests tempered underlying inflation despite marginal fluctuations in the broader CPI.
Meanwhile, at 15:45 a.m. ET, Wall Street’s main indexes remain positive and steady. The S&P 500 benchmark was up by 0.91%, totaling a 40 basis point increase. The tech-heavy Nasdaq composite jumped by 1.06%, totaling a market increase estimated at 146 basis points. Furthermore, the Dow Jones Industrial Average jumped by 0.89%, which is 323 basis points.
In other economic news, A year after the CHIPS Act’s congressional passage, the White House has announced that over 460 businesses have indicated an interest in obtaining funds through it. This extensive law provides tax benefits for domestic semiconductor manufacturers of around $53 billion. Its main objective is to strengthen the United States’ position in the global semiconductor market by reducing reliance on Asian suppliers, notably China. That was made clear by the interruptions caused by the pandemic and geopolitical unrest. This program is a calculated strategic step toward strengthening the nation’s semiconductor capabilities and promoting supply chain resilience.
While corporate earnings results remain in the spotlight, Walt Disney’s stock increased by 1%, boosting the mood of the overall market. This rally came after the company disclosed plans to raise the pricing for its streaming services and reduce password sharing in an effort to make up for weak performance in its film and television businesses. The company’s streaming segment, which includes services like Disney+ and Hulu, outperformed anticipated profit increases in the third quarter of the fiscal year due to increased membership fees and reduced marketing costs.
In its vast entertainment industry, Disney has started looking into the possibilities of artificial intelligence. A task group within the company has been established to understand the uses of AI, according to a recent Reuters article that cited three insider sources. Disney’s proactive commitment to managing shifting industrial environments and utilizing cutting-edge technology is shown by this complex strategy.