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Markets are little changed following the latest US inflation data

Dow went up 20, advances over decliners 5-2 & NAZ added 69.  The MLP index added 1 to the 278s & the REIT index rose 2+ to the 374s.  Junk bond funds were mixed & Treasuries saw a little buying which reduced yields.  Oil was off 1 to the low 78s & gold gained 15 to 2358.

AMJ (Alerian MLP Index tracking fund)

Home Depot misses on revenue, as high interest rates hurt sales

The 10-year Treasury yield wavered after wholesale inflation data came in stronger than expected.  The yield on the 10-year Treasury slipped 2 basis points to 4.463% after initially popping above the 4.5% level following the new data.  The 2-year Treasury yield was last at 4.832% after sliding by nearly 3 basis points.  Yields & prices have an inverted relationship & 1 basis point is equivalent to 0.01%.  The closely followed consumer price index for Apr is due tomorrow.  The forecast is expected to show a 3.4% increase in prices from a year ago & a 0.4% rise on a monthly basis.  Following today's PPI reading, Federal Reserve Chair Jerome Powell said that central bank will need to practice patience in the face of inflation that has persisted at higher-than-expected levels.  That comes after the Fed said at its last meeting that there has been “a lack of further progress” in bringing inflation down to its 2% target.  Policymakers have also repeatedly said that they are looking to data for evidence about inflationary pressures cooling before they feel ready to cut interest rates.  The data could, therefore, affect investor expectations about when rates may be cut and how many cuts could come this year.

10-year Treasury Yield wavers after release of fresh inflation data

Investors are digesting comments made by Powell after PPI data was disappointing.  One thing is clear, the higher prices will work their way into consumer prices in the comping weeks.

Dow Jones Industrials 

This post first appeared on VerySmartInvesting, please read the originial post: here

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Markets are little changed following the latest US inflation data


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