S&P 500 and Nasdaq Extend 4-day Rally After Wholesale Inflation Eased

Barry Adams
13 Jul, 2023
New York City

Stocks traded higher on Wall Street after wholesale inflation declined following the weakness in consumer inflation.

Two inflation reports in as many days lifted market sentiment and the yield on Treasuries edged lower.  

Market indexes edged higher and extended weekly gains after the producer price index decreased 0.1% in June. following an upwardly revised 0.4% increase in May, the U.S. Bureau of Labor Statistics reported Thursday. 

Core wholesale price inflation, which strips out volatile food and energy prices, also declined 0.1% in June. 

On a year basis, producer price index rose at a slower pace of 0.1% in June after rising 0.9% in May, 

In overseas economic news, the UK's GDP in May shrank less than expected and inflation in France eased in June. 

The annual retail price inflation eased to 4.5% in June from 5.1% May, but remained well above the central bank's target rate of 2%, France's statistical agency INSEE reported Thursday. 

The ongoing decline in petroleum products by 17.2% compared to 9.7% in April, drove energy prices by 3% compared to 2% in May. 

In other economic news, the UK economy contracted less than expected in May. 

Real GDP declined 0.1% in May, reversing 0.2% rise in April, the Office for National Statistics reported Thursday. 

China's exports declined 12.4% to $285.3 billion in June, worse than the 7.5% fall in May, General Administration of Customs reported Thursday. 

Imports fell 6.9% in the month to $214.7 billion. 

Exports to the U.S. declined 23.7% to $42.7 billion, to the EU fell 12.9% and to the ASEAN region dropped 16.9% to $43.3 billion from a year ago. But exports to Russia soared 90.9%  from a year ago. 

Exports to the U.S. fell for the eleventh month in a row on the ongoing political tensions between two largest economies oof the world. 

In the first half, exports declined 3.2% from a year ago in 2022. 

China's trade surplus declined to $70.6 billion in June from $65.7 billion in May.  

 

U.S. Indexes & Yields 

The S&P 500 index futures traded higher 0.02% to 4,444.97 and the Nasdaq Composite edged higher 0.3% to 13,729.69.

The yield on 2-year Treasury notes decreased to 4.67%, 10-year Treasury notes inched lower to 3.83% and 30-year Treasury bonds edged down to 3.94%. 

Crude oil decreased $0.33 to $75.41 a barrel and natural gas prices decreased 1 cents to $2.64 a thermal unit. 

 

Stock Movers 

Delta Air Lines rose 3.5% to $49.75 after the international air carrier reported record  quarterly earnings and sales and also lifted its 2023 earnings estimate. 

MillerKnoll Inc increased 1.1% to $16.65 after the furniture maker reported better-than-expected earnings. 

The company reported earnings of 41 cents a share and revenue of $957 million. 

PepsiCo increased 1.1% to $185.22 after the food and beverage company reported better-than-expected revenue of $22.32 billion and adjusted net income of $1.96 a share.