NEW YORK: The S&P 500 ended lower and the Nasdaq higher on Thursday (Aug 31) after US inflation data matched estimates, underscoring expectations the Federal Reserve (Fed) could pause its monetary tightening, while Salesforce climbed following an up upbeat forecast.
The Dow Jones Industrial Average fell 168.33 points, or 0.48%, to 34,721.91, the S&P 500 lost 7.21 points, or 0.16%, to 4,507.66 and the Nasdaq Composite added 15.66 points, or 0.11%, to 14,034.97.
All three main indices posted losses for August, with the S&P 500 and Nasdaq logging their first monthly declines since February.
For the month, the S&P 500 fell 1.8%, the Dow fell 2.4% and the Nasdaq fell 2.2%.
The Nasdaq reached its highest in over four weeks after a Commerce Department report showed the Personal Consumption Expenditures (PCE) price index, considered the central bank’s preferred inflation gauge, climbed 3.3% in July on an annual basis, in line with expectations.
Excluding volatile food and energy components, the core PCE price index rose 4.2% in July, year-on-year, also in line with estimates.
Traders’ expectations for a pause in rate hikes at the Fed’s September policy meet remained at an 88.5% chance, while their bets on the central bank keeping rates unchanged in November stood at 51%, according to the CME Group's FedWatch tool.
“Investors believe the Fed is data dependent, and the data is in the market’s favour. All these interest rate hikes are paying off,” said Jake Dollarhide, CEO of Longbow Asset Management in Tulsa, Oklahoma.
Investors are awaiting more comprehensive non-farm payrolls data due on Friday for greater clarity on the Fed’s likely monetary path.
The yield on the 10-year Treasury notes eased to 4.09%, lifting major growth stocks such as Amazon, which gained 2.2%.
The most traded stock in the S&P 500 was Tesla , with US$27.7 billion worth of shares exchanged during the session. The electric car maker’s shares rose 0.46%.
Salesforce rallied 3% following upbeat revenue forecasts from the cloud-based software provider as it benefits from price hikes and a resilient demand.
Weekly jobless claims for the week ended Aug 26 fell to 228,000, compared with estimates of 235,000 claims, reining in investor sentiment, the Labor Department said in a report.
The data follows smaller-than-expected growth in private payrolls on Wednesday that signalled a softening labour market and drove the S&P 500 to a three-week closing high.
Dismal manufacturing data from China hit the US-listed shares of Chinese companies JD.com and Baidu, down 2.2% and 1.6%, respectively. – Reuters
Source: The Sun Daily
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