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The S&P 500 slid 38.54 points, or 0.8%, to close at 4,646.71 on Wednesday. Eight of the 11 major sectors of the broader index closed in the red led by a nearly 3% decline in the energy sector and 1.7% and 1.3% decline in technology and communication services sectors, respectively.
The Nasdaq Composite Index closed at 15,622.71, after declining 263.83 points, or 1.7%, yesterday. The tech-heavy index was weighed down by 7.1% drop in shares of DocuSign, Inc. (DOCU - Free Report) , followed at least 6% drop in shares of MercadoLibre, Inc. (MELI - Free Report) and Advanced Micro Devices, Inc. (AMD - Free Report) .
On Wednesday, the fear-gauge CBOE Volatility Index (VIX) increased 5.3%, to close at 18.73. Declining issues outnumbered advancing ones on the NYSE by a 2.26-to-1 ratio. A total of 11.72 billion shares were traded yesterday, higher than the last 20-session average of 10.89 billion.
The Rise in Consumer Prices Push Inflation Rate Higher
On Wednesday, the U.S. Bureau of Labor Statistics reported that its consumer price index (CPI) rose 0.9% in October, higher than the consensus estimate of 0.6%. The index that helps in measuring the pace of inflation over the past year jumped to 6.2% in October, from 5.4% in the prior month. For the month, the price for a broad basket of items has increased, the indexes for energy, shelter, food, used cars and trucks, and new vehicles were among the larger contributors. Specifically, gasoline rose 6.1% in October, sending the energy index up 4.1%, while grocery prices have climbed 5.3% year over year and the cost of food climbed 0.9% in the last month.
Core CPI that excludes food and energy prices rose 0.6% in October. The rate of inflation is now nearly 31-year high and the ongoing shortages of labor and supplies might push high inflation to persist into early 2022. The reports clouded investors’ sentiments on Wednesday putting pressure on technology and growth-oriented stocks, and drove them towards banking stocks, gold and bitcoin for refuge. Additionally, a poor auction in 30-year Treasury bonds added steam to the spike yesterday, its biggest daily jump since Mar 12. The 10-year Treasury note yield rose about 11 basis points, the most in one day since Nov 9 last year.
Initial Claims Hits New Pandemic-Era Low
Per a separate report from the Labor Department, initial jobless claims fell by 4,000 to a seasonally adjusted 267,000 for the week ending Nov 6. The figure is slightly higher than the consensus estimate of 262,000 but lower than the upwardly revised figure of 271,000 for the week before. Continuing claims also hit a new pandemic-era low, falling 107,000 from the previous week to about 2.6 million.
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Stock Market News for Nov 11, 2021
Benchmarks closed in the red on Wednesday as economic data signaled a long-term inflation threat, which in turn sent Treasury yields higher.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 240.04 points, or 0.7%, to close at 36,079.94, weighed down by 3.2% loss in shares of salesforce.com, inc. (CRM - Free Report) and NIKE, Inc. (NKE - Free Report) . Salesforce carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The S&P 500 slid 38.54 points, or 0.8%, to close at 4,646.71 on Wednesday. Eight of the 11 major sectors of the broader index closed in the red led by a nearly 3% decline in the energy sector and 1.7% and 1.3% decline in technology and communication services sectors, respectively.
The Nasdaq Composite Index closed at 15,622.71, after declining 263.83 points, or 1.7%, yesterday. The tech-heavy index was weighed down by 7.1% drop in shares of DocuSign, Inc. (DOCU - Free Report) , followed at least 6% drop in shares of MercadoLibre, Inc. (MELI - Free Report) and Advanced Micro Devices, Inc. (AMD - Free Report) .
On Wednesday, the fear-gauge CBOE Volatility Index (VIX) increased 5.3%, to close at 18.73. Declining issues outnumbered advancing ones on the NYSE by a 2.26-to-1 ratio. A total of 11.72 billion shares were traded yesterday, higher than the last 20-session average of 10.89 billion.
The Rise in Consumer Prices Push Inflation Rate Higher
On Wednesday, the U.S. Bureau of Labor Statistics reported that its consumer price index (CPI) rose 0.9% in October, higher than the consensus estimate of 0.6%. The index that helps in measuring the pace of inflation over the past year jumped to 6.2% in October, from 5.4% in the prior month. For the month, the price for a broad basket of items has increased, the indexes for energy, shelter, food, used cars and trucks, and new vehicles were among the larger contributors. Specifically, gasoline rose 6.1% in October, sending the energy index up 4.1%, while grocery prices have climbed 5.3% year over year and the cost of food climbed 0.9% in the last month.
Core CPI that excludes food and energy prices rose 0.6% in October. The rate of inflation is now nearly 31-year high and the ongoing shortages of labor and supplies might push high inflation to persist into early 2022. The reports clouded investors’ sentiments on Wednesday putting pressure on technology and growth-oriented stocks, and drove them towards banking stocks, gold and bitcoin for refuge. Additionally, a poor auction in 30-year Treasury bonds added steam to the spike yesterday, its biggest daily jump since Mar 12. The 10-year Treasury note yield rose about 11 basis points, the most in one day since Nov 9 last year.
Initial Claims Hits New Pandemic-Era Low
Per a separate report from the Labor Department, initial jobless claims fell by 4,000 to a seasonally adjusted 267,000 for the week ending Nov 6. The figure is slightly higher than the consensus estimate of 262,000 but lower than the upwardly revised figure of 271,000 for the week before. Continuing claims also hit a new pandemic-era low, falling 107,000 from the previous week to about 2.6 million.