U.S. Major Averages Hit New Intraday Records After Core Inflation Dropped to a 3-year Low

Barry Adams
15 May, 2024
New York City

Stocks and benchmark indexes advanced in Wednesday's trading after consumer price inflation rose at a slower-than-expected pace in April. 

The S&P 500 index and the Nasdaq Composite advanced 0.5% and traded at new record highs following the weaker-than-expected increase in inflation. 

Consumer price inflation rose at a slower annual pace of 3.4% in April from 3.5% in March, the U.S. Bureau of Labor Statistics reported Wednesday. 

The seasonally adjusted inflation index rose 0.3% in April after rising 0.4% in March on a monthly basis. 

The index for shelter and gasoline rose, and combined, these two indexes contributed over seventy percent of the increase in all items. 

The energy index increased 1.1% over the month, and the food index was unchanged. 

The prices for used and new vehicles, household furnishings, and operations declined in the month. 

The so-called core index, which excludes energy and food prices, slowed to a 0.3% increase after rising to 0.4% in each of the three previous months. 

The annual pace of core consumer price index dropped to 3.6%, the lowest level since April 2021. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.5% to 5,274.11, and the Nasdaq Composite rose 0.5% to 16,585.72. 

The yield on 2-year Treasury notes edged lower to 4.76%, 10-year Treasury notes decreased to 4.37%, and 30-year Treasury bonds edged lower to 4.53%.

WTI crude oil decreased $0.56 to $77.45 a barrel, and natural gas prices increased 3 cents to $2.37 a thermal unit.

Gold increased by $7.19 to $2,362.67 an ounce, and silver rose 17 cents to $28.76. 

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.87.

 

U.S. Stock Movers

AMC Entertainment decreased 7.8% to $6.89, and GameStop Corp. plunged 10% to $43.70. 

Nextracker Inc. increased 14.5% to $49.24 after the solar technology company said revenue in the fiscal fourth quarter increased more than expected. 

Revenue in the quarter rose 42% to $737 million from $518.9 million, net income advanced to $223.2 million from $27.5 million, and diluted earnings per share rose to $1.51 from 2 cents a year ago. 

The company estimated fiscal 2025 revenue between $2.8 billion and $2.9 billion, net income between $369 million and $399 million, and diluted earnings per share between $2.41 and $2.61. 

Boot Barn Holdings dropped 6.3% to $100.31 after the western apparel retailer offered a muted annual outlook. 

Net sales fell 8.7% to $388.5 million, and decreased 2.2% when $28.3 million of sales in the 14th week of the prior-year period were excluded. 

Same-store sales declined 5.9% in the first quarter compared to the prior-year period, and same-store sales on a 3-year stack basis rose 55%. 

The 5.9% decrease in consolidated same-store sales is comprised of a 5.7% decrease in retail store sales and a 7.6% decrease in e-commerce.

Net sales declined to $388.5 million from $425.6 million, net income dropped to $29.4 million from $46.4 million, and diluted earnings per share dropped to 96 cents from $1.53 a year ago. 

The company guided fiscal 2025 sales to fall between $1.766 billion and $1.800 billion, representing growth of 5.9% to 8.0% over the prior year.

The retailer estimated net income of $140.2 million to $149.3 million and net income per diluted share of $4.55 to $4.85 based on 30.8 million weighted average diluted shares outstanding.