The S&P 500 and Nasdaq ended higher on Wednesday after data showing a moderate increase in consumer prices in August cemented expectations that the Federal Reserve will leave interest rates unchanged in September.
Market Snapshot
The S&P 500 climbed 0.12% to end the session at 4,467.44 points. The Nasdaq gained 0.29% to 13,813.59 points, while the Dow Jones Industrial Average declined 0.20% to 34,575.53 points.
Market Movers
Apple (AAPL) was down 1.2%, a day after declining 1.7% following the unveiling of its new iPhone lineup.
American depositary receipts of NIO (NIO) declined 4.7%, XPeng (XPEV) was down 3.1%, and Li Auto (LI) fell 0.5% after European Commission President Ursula von der Leyen said an antisubsidy investigation would be launched into Chinese electric-vehicle makers. Tesla (TSLA), which holds a sizable share of the European EV market, rose 1.4%.
American Airlines (AAL) slid 5.7% after cutting guidance, prompted by higher labor costs following its pay agreement with pilots and elevated fuel prices. Spirit Airlines (SAVE) fell 6.3% after the airline reduced its third-quarter guidance, citing higher fuel prices and an increase in discounted flights booked through the pre-Thanksgiving travel window. Other airline stocks also fell, with Delta Air Lines (DAL) down 2.8% and Southwest Airlines (LUV) off 1.7%.
Moderna (MRNA) rose 3.2% after the vaccine maker released positive results from a late-stage trial of an mRNA flu vaccine and noted strides made in investigational treatments for cancer and latent, rare, and infectious diseases.
Ford (F) rose 1.5% to $12.64, and General Motors (GM) rose 0.6% to $33.66. UBS initiated coverage of Ford with a Buy rating and price target of $15, while the analysts upgraded General Motors to Buy from Neutral and raised the price target to $44 from $41. The upgrades come as the United Auto Workers and the “Detroit Three” auto makers, including Stellantis (STLA), are running out of time to negotiate a new labor contract before the deadline Thursday at 11:59 p.m. UBS said four weeks of a strike at each of the auto makers has been priced in.
Rocket Pharmaceuticals (RCKT) jumped 38.9% after the pharmaceutical company said it reached alignment with the Food and Drug Administration regarding its global Phase 2 trial for a treatment of Danon disease, a fatal genetic cardiac disease.
Citigroup (C) was up 1.7% after the bank announced steps to streamline operations under Chief Executive Jane Fraser.
Market News
SoftBank-Backed Arm Prices IPO at $51 a Share
Arm Holdings Plc priced its initial public offering at the top end of its range to raise $4.87 billion in the largest listing of the year, one that could give a major lift to long-suffering equity markets. Arm had marketed the shares for $47 to $51 each.
At the IPO price, Arm is valued at about $54.5 billion, according to Bloomberg News calculations. Underwriters have the option of buying as many as 7 million additional shares.
The shares are expected to begin trading Thursday on the Nasdaq Global Select Market under the symbol ARM.
US Core CPI Picks Up, Keeping Another Fed Hike in Play This Year
Underlying US inflation ran at a faster-than-expected monthly pace in August, leaving the door open for additional interest-rate hikes from the Federal Reserve.
The so-called core consumer price index, which excludes food and energy costs, advanced 0.3% from July, marking the first acceleration since February, Bureau of Labor Statistics data showed Wednesday. From a year ago, it increased 4.3%, in line with estimates and marking the smallest advance in nearly two years.
Economists favor the core gauge as a better indicator of underlying inflation than the overall CPI. That measure rose 0.6% from the prior month, the most in over a year and reflecting higher energy prices. Gasoline costs accounted for over half of the advance in the overall measure in August, according to BLS.