Big banks post strong Q3 profits, but warn higher rates and inflation could bite
Goldman’s trading gains offset JPMorgan’s earnings miss as banks warned that higher rates and inflation could pressure lending and deal activity.
- September consumer prices rose 3.7% year-on-year, exceeding the 3.6% economists expected, according to the Labor Department, sending major indices lower as Treasury yields surged.
- Core inflation, stripping out volatile food and energy costs, topped forecasts at 2.6% versus 2.5% expected. Skyler Weinand, chief investment officer at Regan Capital, commented that "inflation is stubborn and moving in the wrong direction."
- Investor expectations of a quarter-point rate hike at this month's Federal Reserve meeting nearly doubled to 44 percent, according to CME Fedwatch, pressuring rate-sensitive stocks like Rocket, Hudbay, and Wayfair.
- Treasury yields reacted sharply, with the 10-year yield rising 7 basis points to 5.29%, while gold prices fell 1.1% to $4,116 as higher rates reduced the non-interest-paying asset's appeal.
- Annual headline inflation reached its highest level since May, prompting eToro analyst Bret Kenwell to note traders may "reassess the odds of a Fed rate hike later this month." The Federal Reserve meets October 27-28.
175 Articles
175 Articles
Hot US inflation data dents Wall Street stocks
The consumer price index (CPI) was up more than analysts expected in September, rising 3.7 percent on a year-on-year basis, the Labor Department said. It was a marked acceleration from the 3.4 percent reading in August. Economists had forecast a slightly cooler reading of 3.6 percent, according to MarketWatch. "Today's CPI report came in hot, with annual headline inflation reaching its highest level since May," said eToro analyst Bret Kenwell. "…
Investors on lookout for key US inflation data to gauge impact of rising energy costs on Fed's future policy roadmap, while broader tech selloff pressure equity markets across US, Europe
Daily Journal
US futures mostly higher as Wall Street braces for latest consumer inflation report
U.S. futures are mostly higher as Wall Street braces for one of the last price reports the government will issue before the midterm elections. Consumer prices are forecast to have risen 3.6% in September compared with a year earlier, up…
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