US stocks made notable gains on Friday morning as investors focused on a key inflation report that may influence the Federal Reserve’s forthcoming policy decisions. The Dow Jones Industrial Average rose by 0.5%, while the S&P 500 increased by 0.7%. The Nasdaq Composite experienced a more impressive jump of 1%.
The spotlight of the day was firmly on the September inflation data, which had been delayed by the ongoing government shutdown. The Consumer Price Index (CPI) report revealed a 3% annual increase, the highest since May, but slightly below the anticipated 3.1% increase. On a month-to-month basis, prices rose by 0.3%, a minor cooling from August’s figure and again below expectations.
This inflation report marked the first significant economic release during the shutdown, providing investors with a vital assessment of the economic landscape. The CPI data did little to disrupt the prevailing investor sentiment, with a near-universal consensus expecting a quarter-point rate cut from the Fed in the upcoming week. Currently, around 99% of market bets favor such a cut, and approximately 96% predict an additional rate reduction by December.
In the realm of trade, President Trump introduced new uncertainty into negotiations with key US allies, announcing the cancellation of trade talks with Canada. This decision was reportedly triggered by a Canadian advertisement against his tariff plans, which featured former President Ronald Reagan’s voice.
Despite the tumultuous week on Wall Street, stocks appeared on track for weekly gains. In a notable corporate development, shares of Intel surged nearly 6% in early trading after the chip giant exceeded Wall Street revenue estimates for the third quarter, sparking optimism within the semiconductor sector. Intel’s head of investor relations, John Pitzer, expressed confidence in the company’s potential role in artificial intelligence during an interview with Yahoo Finance.
In other market movements, Procter & Gamble saw its stock rise 3% prior to the opening bell after the company reported better-than-expected first-quarter earnings. Ford also experienced a share increase of 3% after beating earnings estimates for the third quarter. Meanwhile, Newmont’s shares fell by 5% after it reported earnings and signaled lower free cash flow expectations. QuantumScape’s shares rose 1% in premarket trading following a significant increase the previous day, fueled by reports of government negotiations for equity stakes in exchange for funding in the quantum computing sector.
Conversely, Deckers’ stock dropped more than 10% in premarket trading after the company projected full-year sales to fall below analysts’ expectations, citing concerns about consumer behavior amidst ongoing tariffs. In contrast, Sanofi’s stock climbed over 3% before the market open, buoyed by third-quarter earnings that surpassed forecasts due to strong demand for its asthma drug Dupixent, although the company expressed concerns about lower vaccination rates attributed to negative sentiment surrounding vaccines.
Amid these corporate dynamics, oil prices are on track for their largest weekly gain in several months, driven by market reactions to sanctions on Russia.
