Global Markets Advance as Inflation Eases In U.S., Germany, China

Barry Adams
10 Aug, 2022
New York City

Investors cheered the latest inflation report and benchmark indexes rallied led by a surge in tech stocks. 

Tech stocks led the gainers after the inflation index eased in July but stayed elevated near a four-decade high after the 7.7% fall in gasoline index was outpaced by higher food and housing indexes. 

Consumer prices for goods and services were flat in July on a monthly basis but remained elevated despite the decline in energy prices. 

The Consumer Price Index in July was flat from the previous month and rose 8.5% from a year ago, the Bureau of Labor Statistics said Wednesday. 

Core index, which excludes volatile food and energy prices, rose 0.3% from the previous month and jumped 5.9% from a year ago in July. 

The S&P 500 surged 2.1% to 4,206.71 and the Nasdaq Composite index soared 2.6% to 12,811.94. 

The S&P 500 and the Nasdaq Composite indexes closed at 3-month highs. 

Amazon, Apple, and Alphabet rose more than 2% and Meta Platforms soared 6%. 

Futures of crude oil prices declined $1.20 to $91.20 a barrel and natural gas edged up 42 cents to $8.24 a thermal unit. 

After the release of the latest inflation report, the yield on 10-year U.S. Treasury notes edged down to 2.79% and 30-year U.S. Treasury bond fell to 2.96%. 

The yield on 2-year U.S. Treasury notes edged down to 3.15%. 

Coinbase Global Inc rose 7.2% to $93.98 after the cryptocurrencies exchange operator said second quarter net revenues fell to $803 million from $2.03 billion a year ago. 

Coinbase swung to a net loss of $1.1 billion from a profit of $1.6 billion a year ago. 

The exchange operator said monthly transacting users edged up to 9.0 million from 8.8 million a year ago and transacting volume plunged to $217 billion from $462 million a year ago.  

Bitcoin, the most heavily traded cryptocurrency on the exchange, has plunged 74% from the peak in November 2021 to the low in June 2022.  

GoodRx Holdings declined 5.5% to $7.39, after surging nearly 40% in the previous session, after the online pharmacy price comparison services reported better-than-expected quarter results two days ago.   

Nikola Corp gained 0.4% to $6.99 after the company said its chief executive officer Mark Russell will retire at the end of 2022. 

Tesla Inc gained 3.9% to $883.07 and chief executive Elon Musk sold 7.92 million shares between Aug 5 and Aug 9 for $6.88 billion, according to a series of regulatory filings with the SEC. 

Walt Disney Co increased 4.1% to $112.50 ahead of the earnings release later today.  

 

European Markets Advance, German Inflation Eases 

European markets accelerated gains after the U.S. and German inflation eased but stayed elevated. 

German consumer price growth eased in July to 7.5% from 7.6% in June and matched the preliminary estimates, according to the Federal Statistical Office data on Wednesday. Consumer prices increased 7.9% in May. 

On a monthly basis, prices rose 0.9% in July despite the fall in energy prices and two subsidies provided by the government. 

The U.S. consumer prices rose at a slower pace 8.5% in July on an annual basis, according to the report released by the U.S. Bureau of Labor Statistics. 

The inflation eased but stayed near the 4-decade high after the energy prices fell. The inflation index on a monthly basis was unchanged. 

The DAX index increased 0.8% to 13,646.60, the CAC-40 index increased 0.4% to 6,517.47, and the FTSE 100 index added 0.3% to 7,510.40. 

Vestas Wind Systems rose 10.4% to 26.91 euros after the company agreed to sell its converters and control panels business to KK Wind Solutions. 

Aviva PLC jumped 11.2% to 4604.0 pence after the insurance company reported higher-than-expected earnings in the first-half and released a plan to return more cash to stockholders with the release of full-year results. 

 The insurance company increased first-half dividend 40% from a year ago to 10.3 pence a share. 

Ahold Delhaize NV jumped 6.3% to 28.29 euros after the Dutch supermarket chain reported net sales in constant currencies rose 6.4% and at nominal exchange rate rose 15% to 21.4 billion euros. 

The food retailer lifted its interim dividend to 46 euro cents from 43 cents a year ago and lifted its cumulative free cash flow estimate to 7.5 billion euros from above 6 billion euros between 2022 and 2025. 

Net income increased 11.7% to 603 million euros or 59 cents a diluted share from 540 million euros or 53 diluted share a year ago.    

TUI AG declined 0.1% to 143.20 pence after the tour operator said load factor in the June quarter increased to 92%, exceeding 90% in the same quarter in 2019. 

The tour operator handled 5.1 million customers in the quarter compared to 4.1 million a year ago. 

Revenues in the quarter rose to 4.4 billion euros compared to 649 million a year ago. Net loss in the quarter shrank to 27 million euros from 670 million euros a year ago. 

At the end of June, the company repaid