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Stock Market News for Oct 13, 2023

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U.S. stocks ended lower on Thursday, snapping their four-day winning streak, as Treasury yields continued to rise while investors digested fresh inflation data that showed consumer prices increased in September. All three major indexes ended in negative territory.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) slid 0.5% or 173.73 points to end at 33,631.14 points.

The S&P 500 slumped 0.6% or 27.34 points, to close at 4,349.61 points. Utilities, materials, real estate communication services stocks were the worst performers.

The Utilities Select Sector SPDR (XLU) and the Materials Select Sector SPDR (XLB) each fell 1.5%. The Communication Services Select Sector SPDR (XLC) declined 1.2%. The Real Estate Select Sector SPDR (XLRE) lost 1.3%. Ten of the 11 sectors of the benchmark index ended in negative territory.

The tech-heavy Nasdaq dropped 0.6% or 85.46 points to finish at 13,574.22 points.

The fear-gauge CBOE Volatility Index (VIX) was up 3.73% to 16.69. A total of 10.91 billion shares were traded on Thursday, higher than the last 20-session average of 10.75 billion. Decliners outnumbered advancers on the NYSE by a 4.46-to-1 ratio. On the Nasdaq, a 2.89-to-1 ratio favored declining issues.

Treasury Yields Rise after September CPI Rises

All three major indexes rose for the fourth straight day on Wednesday to record their longest winning streak since August. However, the rally stalled on Thursday pressured by a rise in bond yields after data showed that consumer price inflation rose in September.

The Bureau of Labor Statistics reported that the consumer price index (CPI) rose 0.4% month over month in September, higher than the consensus estimate of a rise of 0.3%. Year over year, CPI rose 3.7% in September, unchanged from August but higher than economists’ expectations of a rise of 3.6%.

September’s jump was primarily driven by a jump in energy prices. Core CPI, which excludes the volatile food and energy prices, rose 0.3% in September, which came in line with expectations.

The fresh inflation data didn’t give a clear picture of how the Fed plans to move with its interest rate hikes in the future. However, the Fed-funds futures traders saw the chances of a 25 basis point interest rate hike in December increase to 31.4% on Thursday, up from 26.3% a day earlier.

Following the release of the CPI data, bond yields once again soared. The 10-year Treasury yield increased more than 11 basis points to 4.70%. The 2-year Treasury yield moved 6.6 basis points higher to 5.069%.

Tech stocks declined on Thursday. Shares of Salesforce, Inc. ((CRM - Free Report) ) fell 0.6%, while Meta Platforms, Inc. ((META - Free Report) ) and Netflix, Inc. ((NFLX - Free Report) ) declined 1.1% and 1.3%, respectively. Salesforce has a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Economic Data

In other economic data released on Thursday, the Labor Department said that jobless claims totaled 209,000 for the week ending Oct 7, unchanged from the previous week’s revised level of 209,000 from 207,000. The four-week moving average was 206,250, a decrease of 3,000 from the previous week’s revised average of 209,250.

Continuing claims came in at 1,702,000, an increase of 30,000 from the previous week’s revised level of 1,672,000. The 4-week moving average was 1,674,250 an increase of 4,750 from the previous week's revised average of 1,669,500.


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