Dow Jones Industrial Average (DJIA) index closed lower on Tuesday despite better-than-expected US Consumer Price Index (CPI) for June. Dow Jones futures remained unchanged on Wednesday ahead of US PPI data for June.
US Markets Concerns
Dow Jones futures were at a standstill ahead of US Producer Price Index (PPI) data later in the day. Analysts expect the PPI for June to decline to 0.6% from May’s 0.8% increase. However, the annual PPI increase is expected to increase 0.2% to 6.8%.
The core PPI is expected to come in 0.5% lower on a month-on-month basis. However, the core PPI is expected to increase by 5.1% YoY.
US Treasury Bond yields edged lower ahead of the opening of markets. US 10-year bond yield dipped to 1.410% while the 30-year bond yield fell to 2.034% amid inflation surges. According to data released on Tuesday, the US inflation for June soared at its fastest pace in 13 years.
The Federal Reserve has termed the current jumps in inflation as transitory. The Fed has reiterated that the inflation pressures could decrease in the second half of this year. The Delta variant has escalated fears in the markets despite the successful vaccination rollout.
Investors are now eyeing Jerome Powell’s semi-annual appearance before the congress. They are hoping to get clues on what the Federal Reserve thinks on the current inflation rise. The Fed chair is expected to give his opinion on the economy’s performance for the first half of the year and his expectations for the second half.
US president Joe Biden’s drive for a huge and new infrastructure investment received support on Tuesday. According to Senate Majority Leader, Chuck Schumer, the Senate Democrats agreed on a $3.5 trillion investment plan.
Dynatrace Inc was among the best performers in the pre-market trade. The software company gained more than 3.98% in its stock earnings. The company reported a 35% jump in the first half of 2021. The company’s management forecasts a 30% growth in the foreseeable future.
American Airlines gained 1.05% in its stock price. The airline company closed in 3.93% lower on Wednesday amid Delta variant concerns in the travel sector. However, the company has predicted better-than-expected second-quarter numbers.
AMC Entertainment Holdings Inc continued its losing streak on Wednesday. The company’s stock earnings slipped 3.58% in pre-market trading. The company recently announced its decision not to issue more equity.
Didi Global Inc is still on a downward trend. The company’s stock prices fell 2.33%. The company’s stocks have been falling since Chinese regulators announced a cybersecurity review of the company. China has sworn to crack down on Chinese companies listed on the US exchanges.
Cheesecake Factory stock slumped 1.65% in premarket trade after jumping more than 4.7% on Monday. Raymond James upgraded the company’s shares to outperform.