Market Update
Accelerating Consumer Price Inflation Complicates Fed's Balancing Act
Barry Adams
11 Sep, 2025
New York City
Wall Street indexes flatlined on Thursday, and investors reviewed the latest update on consumer inflation data.
The S&P 500 index edged up 0.1%, and the tech-heavy Nasdaq Composite inched higher a fraction.
Both benchmark indexes closed at new record highs on Wednesday, after Oracle's growth outlook for its cloud business surprised investors.
Overall consumer price inflation accelerated to 2.9% in August from 2.7% in the previous month, the Bureau of Labor Statistics reported on Thursday.
The core rate of inflation, which excludes volatile food and energy prices, held steady at 3.3% in August.
Producer price inflation in August slowed to 2.6% from the downwardly revised 3.1% in the previous month, the Bureau of Labor Statistics reported on Wednesday.
While net job gains are rapidly cooling over the last three months, consumer prices are still rising, and inflation is at a level above the Fed's target rate of 2%.
The Federal Reserve is widely anticipated to cut rates by at least 25 basis points at the end of the next meeting on September 18, but a minority of investors are holding out for a larger rate cut of 50 basis points.
Moreover, the sharp escalation in import taxes has so far not flowed through the economy, and businesses are not increasing payrolls amid lingering macroeconomic uncertainties.
The latest jobless claims data confirmed deteriorating labor market conditions.
Initial jobless claims advanced by 27,000 from the previous week to 263,000 on the first week of September ending on September 6, the U.S. Department of Labor reported Thursday.
Initial claims reached the highest since October 23, 2021, when claims totaled 268,000.
Continuing jobless claims, which lag one week, ending on August 30, were 1.94 million, matching the downwardly revised level by 1,000 in the previous week.
ECB Holds Rates Steady
The European Central Bank left its key lending rates unrevised for the second consecutive meeting as inflation hovers near the target rate and the economy struggles to expand.
The central bank held steady the main refinancing rate at 2.15% and the deposit facility rate at 2.0%.
The policy committee revised higher its 2025 inflation outlook to 2.1% from the previous estimate of 2.0% and GDP growth outlook to 1.2% from 0.9% released in June, respectively.
U.S. Stock Movers
Chewy Inc. plunged 16.6% to $35.11 despite the online pet food store operator's earnings matching market expectations.
Chewy stock had run up in anticipation of its quarterly results in the hopes that the company's results would deliver outsized earnings growth.
Consolidated revenue increased 9% to $3.10 billion from $2.85 billion, net income plunged to $62 million from $299.1 million, and diluted earnings per share fell to 14 cents from 68 cents a year ago.
Autoship sales grew 15%, making up 83% of total sales, indicating customer loyalty, and both active customers and net sales per average customer rose 4.5% to 21 million and $591, respectively.
Active customers and NSPAC each increased 4.5% from a year ago to nearly 21 million and $591, respectively, highlighting the company’s strong value proposition.
The company estimated adjusted earnings per share between 28 cents and 33 cents, and sales to range between $3.07 billion and $3.1 billion.
Chewy hiked its annual revenue guidance to a range of $12.5 billion and $12.6 billion, from the previous range between $12.3 billion and $12.45 billion.
Daktronics Inc. jumped 20.4% to $20.98 after the digital LED display technology and audio systems provider said net income swung to a profit from a year ago in the first quarter ending on August 2.
Consolidated revenue decreased to $219 million from $226.1 million, net income swung to a profit of $16.5 million from a loss of $4.9 million, and diluted income per share swung to a profit of 33 cents from a loss of 11 cents a year ago.
Daktronics repurchased approximately 0.6 million shares during the quarter, returning $10.7 million to shareholders at an average price of $16.43 per share.
Oxford Industries jumped 16% to $47.02, and the parent company of Tommy Bahama and Lilly Pulitzer branded apparel stores reported better-than-expected adjusted quarterly results.
The specialty apparel retailer said it now expects lower than previously expected tariff expenses in the current financial year.
Accelerating Consumer Inflation Complicates Fed's Balancing Act
Barry Adams
11 Sep, 2025
New York City
Wall Street indexes flatlined on Thursday, and investors reviewed the latest update on consumer inflation data.
The S&P 500 index edged up 0.1%, and the tech-heavy Nasdaq Composite inched higher a fraction.
Both benchmark indexes closed at new record highs on Wednesday, after Oracle's growth outlook for its cloud business surprised investors.
Overall consumer price inflation accelerated to 2.9% in August from 2.7% in the previous month, the Bureau of Labor Statistics reported on Thursday.
The core rate of inflation, which excludes volatile food and energy prices, held steady at 3.3% in August.
Producer price inflation in August slowed to 2.6% from the downwardly revised 3.1% in the previous month, the Bureau of Labor Statistics reported on Wednesday.
While net job gains are rapidly cooling over the last three months, consumer prices are still rising, and inflation is at a level above the Fed's target rate of 2%.
The Federal Reserve is widely anticipated to cut rates by at least 25 basis points at the end of the next meeting on September 18, but a minority of investors are holding out for a larger rate cut of 50 basis points.
Moreover, the sharp escalation in import taxes has so far not flowed through the economy, and businesses are not increasing payrolls amid lingering macroeconomic uncertainties.
ECB Holds Rates Steady
The European Central Bank left its key lending rates unrevised for the second consecutive meeting as inflation hovers near the target rate and the economy struggles to expand.
The central bank held steady the main refinancing rate at 2.15% and the deposit facility rate at 2.0%.
The policy committee revised higher its 2025 inflation outlook to 2.1% from the previous estimate of 2.0% and GDP growth outlook to 1.2% from 0.9% released in June, respectively.
U.S. Stock Movers
Chewy Inc. plunged 16.6% to $35.11 despite the online pet food store operator's earnings matching market expectations.
Chewy stock had run up in anticipation of its quarterly results in the hopes that the company's results would deliver outsized earnings growth.
Consolidated revenue increased 9% to $3.10 billion from $2.85 billion, net income plunged to $62 million from $299.1 million, and diluted earnings per share fell to 14 cents from 68 cents a year ago.
Autoship sales grew 15%, making up 83% of total sales, indicating customer loyalty, and both active customers and net sales per average customer rose 4.5% to 21 million and $591, respectively.
Active customers and NSPAC each increased 4.5% from a year ago to nearly 21 million and $591, respectively, highlighting the company’s strong value proposition.
The company estimated adjusted earnings per share between 28 cents and 33 cents, and sales to range between $3.07 billion and $3.1 billion.
Chewy hiked its annual revenue guidance to a range of $12.5 billion and $12.6 billion, from the previous range between $12.3 billion and $12.45 billion.
Daktronics Inc. jumped 20.4% to $20.98 after the digital LED display technology and audio systems provider said net income swung to a profit from a year ago in the first quarter ending on August 2.
Consolidated revenue decreased to $219 million from $226.1 million, net income swung to a profit of $16.5 million from a loss of $4.9 million, and diluted income per share swung to a profit of 33 cents from a loss of 11 cents a year ago.
Daktronics repurchased approximately 0.6 million shares during the quarter, returning $10.7 million to shareholders at an average price of $16.43 per share.
Oxford Industries jumped 16% to $47.02, and the parent company of Tommy Bahama and Lilly Pulitzer branded apparel stores reported better-than-expected adjusted quarterly results.
The specialty apparel retailer said it now expects lower than previously expected tariff expenses in the current financial year.
Japan's Indexes Scaled New Peaks, Producer Price Inflation Edged Higher
Akira Ito
11 Sep, 2025
Tokyo
Japan's indexes advanced for the second consecutive day this week, and investors reviewed the latest update on business sentiment.
The Nikkei 225 Stock Average increased 0.8%, but the broader Topix decreased 0.2% in cautious trading amid worries about the constantly changing U.S. trade policy.
The U.S. president is looking to impose outsized tariffs on drugs imported from China, and the White House may target pharma shipments from Japan, India, and the European Union.
The worries about the never-ending changes to the U.S. policy were compounded by the legal status of sweeping import taxes after two U.S. court rulings.
Japan's Business Sentiment Index Rebounded in Third Quarter
Closer to home, Japan's Business Survey Index for large manufacturing firms rebounded to 3.8% in the third quarter, said the Cabinet Office on Thursday.
The index, which acts as a key measure of economic health, rebounded from -4.8% in the previous quarter and returned to positive territory in three quarters.
The sentiment improved after U.S. businesses front-loaded ahead of the newly imposed 15% blanket tariffs.
Large manufacturers held out for the continued improvement in the business environment, and the index for the fourth quarter improved to 3.9%, but edged lower to 3.3% for the first quarter of 2026.
Japan's Producer Price Inflation Accelerated in August
Japan's producer price inflation edged higher in August amid accelerating prices in transportation equipment, general-purpose machinery, and food products.
The annual increase in the producer price index accelerated to 2.7% from the marginally revised 2.5% in the previous month, the Cabinet Office reported Thursday.
The price inflation for foods and beverages accelerated to 5.0% from 4.7%, general-purpose machinery rose to 4.0% from 3.7%, and transportation equipment edged up to 2.0% from 1.8%.
However, on a monthly basis prices decreased 0.2%, following an upwardly revised 0.3% increase in July.
Japan Indexes and Stocks
The Nikkei 225 Stock Average added 0.8% to 44,175.51, and the broader Topix fell 0.2% to 3,136.53.
Toyota Motor decreased 1.3% to ¥2,876.50, Honda Motor declined 0.9% to ¥1,651.0, and Nissan Motor edged 0.4% to ¥356.20.
Nippon Yusen KK decreased 0.1% to ¥5,590.0, Mitsui O.S.K. Lines Ltd. fell 0.8% to ¥4,840.0, and Kawasaki Kisen Kaisha Ltd. fell 0.2% to ¥2,327.50.
Japan's Indexes Scaled New Peaks, Producer Price Inflation Edged Higher
Akira Ito
11 Sep, 2025
Tokyo
Japan's indexes advanced for the second consecutive day this week, and investors reviewed the latest update on business sentiment.
The Nikkei 225 Stock Average increased 0.8%, but the broader Topix decreased 0.2% in cautious trading amid worries about the constantly changing U.S. trade policy.
The U.S. president is looking to impose outsized tariffs on drugs imported from China, and the White House may target pharma shipments from Japan, India, and the European Union.
The worries about the never-ending changes to the U.S. policy were compounded by the legal status of sweeping import taxes after two U.S. court rulings.
Japan's Business Sentiment Index Rebounded in Third Quarter
Closer to home, Japan's Business Survey Index for large manufacturing firms rebounded to 3.8% in the third quarter, said the Cabinet Office on Thursday.
The index, which acts as a key measure of economic health, rebounded from -4.8% in the previous quarter and returned to positive territory in three quarters.
The sentiment improved after U.S. businesses front-loaded ahead of the newly imposed 15% blanket tariffs.
Large manufacturers held out for the continued improvement in the business environment, and the index for the fourth quarter improved to 3.9%, but edged lower to 3.3% for the first quarter of 2026.
Japan's Producer Price Inflation Accelerated in August
Japan's producer price inflation edged higher in August amid accelerating prices in transportation equipment, general-purpose machinery, and food products.
The annual increase in the producer price index accelerated to 2.7% from the marginally revised 2.5% in the previous month, the Cabinet Office reported Thursday.
The price inflation for foods and beverages accelerated to 5.0% from 4.7%, general-purpose machinery rose to 4.0% from 3.7%, and transportation equipment edged up to 2.0% from 1.8%.
However, on a monthly basis prices decreased 0.2%, following an upwardly revised 0.3% increase in July.
Japan Indexes and Stocks
The Nikkei 225 Stock Average added 0.8% to 44,175.51, and the broader Topix fell 0.2% to 3,136.53.
Toyota Motor decreased 1.3% to ¥2,876.50, Honda Motor declined 0.9% to ¥1,651.0, and Nissan Motor edged 0.4% to ¥356.20.
Nippon Yusen KK decreased 0.1% to ¥5,590.0, Mitsui O.S.K. Lines Ltd. fell 0.8% to ¥4,840.0, and Kawasaki Kisen Kaisha Ltd. fell 0.2% to ¥2,327.50.
Japan's Indexes Scaled New Peaks,
Akira Ito
11 Sep, 2025
Tokyo
Japan's indexes advanced for the second consecutive day this week, and investors reviewed the latest update on business sentiment.
The Nikkei 225 Stock Average increased 0.8%, but the broader Topix decreased 0.2% in cautious trading amid worries about the constantly changing U.S. trade policy.
The U.S. president is looking to impose outsized tariffs on drugs imported from China, and the White House may target pharma shipments from Japan, India, and the European Union.
The worries about the never-ending changes to the U.S. policy were compounded by the legal status of sweeping import taxes after two U.S. court rulings.
Japan's Business Sentiment Index Rebounded in Third Quarter
Closer to home, Japan's Business Survey Index for large manufacturing firms rebounded to 3.8% in the third quarter, said the Cabinet Office on Thursday.
The index, which acts as a key measure of economic health, rebounded from -4.8% in the previous quarter and returned to positive territory in three quarters.
The sentiment improved after U.S. businesses front-loaded ahead of the newly imposed 15% blanket tariffs.
Large manufacturers held out for the continued improvement in the business environment, and the index for the fourth quarter improved to 3.9%, but edged lower to 3.3% for the first quarter of 2026.
Japan's Producer Price Inflation Accelerated in August
Japan's producer price inflation edged higher in August amid accelerating prices in transportation equipment, general-purpose machinery, and food products.
The annual increase in the producer price index accelerated to 2.7% from the marginally revised 2.5% in the previous month, the Cabinet Office reported Thursday.
The price inflation for foods and beverages accelerated to 5.0% from 4.7%, general-purpose machinery rose to 4.0% from 3.7%, and transportation equipment edged up to 2.0% from 1.8%.
However, on a monthly basis prices decreased 0.2%, following an upwardly revised 0.3% increase in July.
Japan Indexes and Stocks
The Nikkei 225 Stock Average added 0.8% to 44,175.51, and the broader Topix fell 0.2% to 3,136.53.
Toyota Motor decreased 1.3% to ¥2,876.50, Honda Motor declined 0.9% to ¥1,651.0, and Nissan Motor edged 0.4% to ¥356.20.
Nippon Yusen KK decreased 0.1% to ¥5,590.0, Mitsui O.S.K. Lines Ltd. fell 0.8% to ¥4,840.0, and Kawasaki Kisen Kaisha Ltd. fell 0.2% to ¥2,327.50.
Japan's Indexes Scaled New Highs, Producer Price Inflation Edged Higher
Akira Ito
11 Sep, 2025
Tokyo
Japan's indexes advanced for the second consecutive day this week, and investors reviewed the latest update on business sentiment.
The Nikkei 225 Stock Average increased 0.8%, but the broader Topix decreased 0.2% in cautious trading amid worries about the constantly changing U.S. trade policy.
The U.S. president is looking to impose outsized tariffs on drugs imported from China, and the White House may target pharma shipments from Japan, India, and the European Union.
The worries about the never-ending changes to the U.S. policy were compounded by the legal status of sweeping import taxes after two U.S. court rulings.
Japan's Business Sentiment Index Rebounded In Third Quarter
Closer to home, Japan's Business Survey Index for large manufacturing firms rebounded to 3.8% in the third quarter, said the Cabinet Office on Thursday.
The index, which acts as a key measure of economic health, rebounded from -4.8% in the previous quarter and returned to positive territory in three quarters.
The sentiment improved after U.S. businesses front-loaded ahead of the newly imposed 15% blanket tariffs.
Large manufacturers held out for the continued improvement in the business environment, and the index for the fourth quarter improved to 3.9%, but edged lower to 3.3% for the first quarter of 2026.
Japan's Producer Price Inflation Accelerated In August
Japan's producer price inflation edged higher in August amid accelerating prices in transportation equipment, general-purpose machinery, and food products.
The annual increase in the producer price index accelerated to 2.7% from the marginally revised 2.5% in the previous month, the Cabinet Office reported Thursday.
The price inflation for foods and beverages accelerated to 5.0% from 4.7%, general-purpose machinery rose to 4.0% from 3.7%, and transportation equipment edged up to 2.0% from 1.8%.
However, on a monthly basis prices decreased 0.2%, following an upwardly revised 0.3% increase in July.
Japan Indexes and Stocks
The Nikkei 225 Stock Average added 0.8% to 44,175.51, and the broader Topix fell 0.2% to 3,136.53.
Toyota Motor decreased 1.3% to ¥2,876.50, Honda Motor declined 0.9% to ¥1,651.0, and Nissan Motor edged 0.4% to ¥356.20.
Nippon Yusen KK decreased 0.1% to ¥5,590.0, Mitsui O.S.K. Lines Ltd. fell 0.8% to ¥4,840.0, and Kawasaki Kisen Kaisha Ltd. fell 0.2% to ¥2,327.50.
Investor Optimism Supports China Indexes Near Multi-Year Highs
Li Chen
11 Sep, 2025
Hong Kong
Stock market indexes in Hong Kong came under pressure but in mainland China advanced.
The Hang Seng index decreased 0.4%, and the mainland-focused CSI 300 soared more than 1.5% amid worries about constantly changing U.S. trade policy.
Mainland investors held out for additional monetary and fiscal stimulus amid recent mixed economic data on inflation, fixed-asset investments, residential housing, and labor markets.
The liquidity-driven rally over the last four months hit the wall last week as investors reassessed the earnings growth outlook following a string of weaker-than-expected corporate results.
Despite the elevated trade tensions between the U.S. and China, foreign investors have been pouring money into Chinese stocks trading on the Hong Kong Stock Exchange.
The steady flow of foreign funds supported by the sustained investment from state-controlled banks and retail investors has lifted China's benchmark indexes to multi-year highs.
China Indexes and Stocks
The Hang Seng Index decreased 0.4% to 26,098.09, and the mainland-focused CSI 300 index soared 1.8% to 4,524.16.
Pharmaceutical makers came under pressure amid speculation that the U.S. president is likely to impose additional tariffs and barriers for drugs made in China.
Sino Biopharmaceutical Ltd. decreased 5.4% to HK$8.30, WuXi Biologics declined 4.3% to HK$35.98, and CSPC Pharmaceutical Group dropped 8% to HK$10.07.
Alibaba Group Holding Ltd. edged up 0.6% to HK$143.60, and the company announced a planned offering of $3.2 billion later this year.
Nongfu Spring Co. Ltd. decreased 1.3% to HK$52.0, Chow Tai Fook Jewellery Group Ltd. gained 1.3% to HK$16.54, and Kweichow Moutai Co. Ltd fell 1.3% to ¥1,518.01.
Investor Optimism Supports China Indexes Near Multi-Year Highs
Li Chen
11 Sep, 2025
Hong Kong
Stock market indexes in Hong Kong came under pressure but in mainland China advanced.
The Hang Seng index decreased 0.4%, and the mainland-focused CSI 300 soared more than 1.5% amid worries about constantly changing U.S. trade policy.
Mainland investors held out for additional monetary and fiscal stimulus amid recent mixed economic data on inflation, fixed-asset investments, residential housing, and labor markets.
The liquidity-driven rally over the last four months hit the wall last week as investors reassessed the earnings growth outlook following a string of weaker-than-expected corporate results.
Despite the elevated trade tensions between the U.S. and China, foreign investors have been pouring money into Chinese stocks trading on the Hong Kong Stock Exchange.
The steady flow of foreign funds supported by the sustained investment from state-controlled banks and retail investors has lifted China's benchmark indexes to multi-year highs.
China Indexes and Stocks
The Hang Seng Index decreased 0.4% to 26,098.09, and the mainland-focused CSI 300 index soared 1.8% to 4,524.16.
Pharmaceutical makers came under pressure amid speculation that the U.S. president is likely to impose additional tariffs and barriers for drugs made in China.
Sino Biopharmaceutical Ltd. decreased 5.4% to HK$8.30, WuXi Biologics declined 4.3% to HK$35.98, and CSPC Pharmaceutical Group dropped 8% to HK$10.07.
Alibaba Group Holding Ltd. edged up 0.6% to HK$143.60, and the company announced a planned offering of $3.2 billion later this year.
Nongfu Spring Co. Ltd. decreased 1.3% to HK$52.0, Chow Tai Fook Jewellery Group Ltd. gained 1.3% to HK$16.54, and Kweichow Moutai Co. Ltd fell 1.3% to ¥1,518.01.