Dow falls as core inflation data is higher than expected

The Dow Jones Industrial Average fell Wednesday as traders absorbed a hotter-than-expected August core inflation print.

The Dow lost 70.46 points, or 0.20 per cent, to 34,575.53 for its second straight decline. Meanwhile, the S&P 500 was up 0.12 per cent to 4,467.44. The Nasdaq Composite added 0.29 per cent to end at 13,813.59.

3M was the biggest laggard in the 30-stock Dow, dropping more than 5.7 per cent. Caterpillar shares were lower by 2 per cent. Meanwhile, Apple shares declined more than 1 per cent, falling for a second day.

On the other hand, tech gains helped to lift the S&P 500 and Nasdaq. Tesla shares gained 1.4 per cent after billionaire investor Ron Baron stood by his bullish thesis on the electric vehicle maker. Amazon shares hit their highest level since August 2022; they advanced more than 2.5 per cent.

August’s core inflation print in the consumer price index increased 0.3 per cent and 4.3 per cent respectively, against estimates for 0.2 per cent and 4.3 per cent. Federal Reserve officials focus more on the core number as it provides a better indication of where inflation is heading over the long term.

Meanwhile, the headline numbers rose 0.6 per cent last month, and was up 3.7 per cent from a year ago. Economists surveyed by Dow Jones were looking for respective increases of 0.6 per cent and 3.6 per cent.

Wall Street has mostly priced in a pause in rate hikes at the Fed’s meeting next week. Fed funds futures pricing data as of Wednesday afternoon indicate a 97 per cent probability of rates remaining the same, according to the CME FedWatch Tool.

In commodity-related news, a US Federal Committee is proposing mineral royalties on hardrock mining to fund agencies granting new mining permits. This is part of efforts to secure critical minerals for the domestic electric vehicle industry. They also suggest leasing federal lands for mining and increasing fees to encourage timely claim development.

Overall, US sectors were mixed overnight. Utilities was the best performer, whilst Real Estate was the worst.

Futures

The SPI futures are pointing to a 0.1 per cent fall

Currency

One Australian dollar at 7:25 AM was buying 64.24 US cents.

Commodities

Gold lost 0.13 per cent. Silver fell 0.94 per cent. Copper added 0.03 per cent. Oil lost 0.36 per cent.

Figures around the globe

European markets closed lower. London’s FTSE fell 0.02 per cent, Frankfurt lost 0.39 per cent, and Paris closed 0.42 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei fell 0.21 per cent, Hong Kong’s Hang Seng fell 0.09 per cent while China’s Shanghai Composite closed 0.45 per cent lower.

The Australian sharemarket closed 0.73 per cent lower at 7,154.

Ex-dividends

Au Clinical Labs (ASX:ACL) is paying 7 cents fully franked
Adrad Hldings (ASX:AHL) is paying 1.63 cents fully franked
Austal Limited (ASX:ASB) is paying 3 cents unfranked
Blackwall Limited (ASX:BWF) is paying 2.5 cents fully franked
Centrepoint Alliance (ASX:CAF) is paying 2 cents fully franked
Cash Converters (ASX:CCV) is paying 1 cents fully franked
CTI Logistics (ASX:CLX) is paying 5 cents fully franked
Cleanaway Waste Ltd (ASX:CWY) is paying 2.45 cents unfranked
DDH Drill (ASX:DDH) is paying 1.96 cents fully franked
Data#3 Limited (ASX:DTL) is paying 11.9 cents fully franked
Equity Hl (ASX:EQT) is paying 50 cents fully franked
Fletcher Building (ASX:FBU) is paying 14.7032 cents unfranked
Inghams Group (ASX:ING) is paying 10 cents fully franked
Kelsian Group Ltd (ASX:KLS) is paying 9.5 cents fully franked
Motorcycle Hldg (ASX:MTO) is paying 12 cents fully franked
Nzme Limited (ASX:NZM) is paying 2.7629 cents unfranked
Plato Inc Max Ltd (ASX:PL8) is paying 0.55 cents fully franked
PWR Holdings Limited (ASX:PWH) is paying 8.9 cents fully franked
Ramelius Resources (ASX:RMS) is paying 2 cents fully franked
South32 Limited (ASX:S32) is paying 4.9682 cents fully franked
Spark New Zealand (ASX:SPK) is paying 12.5046 cents unfranked
Seven Group Holdings (ASX:SVW) is paying 23 cents fully franked
Tourismholdings (ASX:THL) is paying 13.8058 cents 21.25 per cent franked
WCM Global Growth (ASX:WQG) is paying 1.66 cents fully franked

Dividends payable

GUD Holdings Ltd (ASX:GUD)
Objective Corp Ltd (ASX:OCL)
McGrath Ltd (ASX:MEA)
Regal Partners Ltd (ASX:RPL)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

Disclaimer

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