(Sharecast News) – US stocks pulled back on Friday morning on Wall Street as investors reacted to more inflation data, which showed that wholesale prices rose more than expected last month.
The Dow Jones was down 0.1% at 35,126, the S&P 500 fell 0.5% to 4,449, while the Nasdaq slipped 0.8% 13,625.
Seasonally adjusted figures showed that the producer price index (PPI) increased 0.3% last month, from a revised flat reading in June. Economists were expecting a smaller rise at +0.2%. This acceleration was led by a 0.5% rise for services, tempered by a 0.1% increase in goods.
Compared with last year, the headline PPI increased 0.8% in July, up from +0.2% in June.
The news comes just one day after data showed consumer price inflation remained steady at 0.2% last month. Stocks had gained on Thursday on hopes that the low inflation would prompt the Federal Reserve to pause their current rate-hiking cycle for now. Though today’s release might complicate matters somewhat.
Comments overnight by head of the San Francisco Fed, Mary Daly, will have raised some concern too, after she said that the monetary authority still had “more work to do” to bring inflation in line with its targets.
In other economic news, the University of Michigan consumer confidence index fell to 71.2 this month, from 71.6 in July, missing economists’ expectations of a slight uptick to 71.7
In stock movements, primary-care provider Cano Health plummeted 49% after revealing a “substantial doubt about the company’s ability to continue as a going concern within one year”. The news came after its second-quarter loss widened to $271m from $15m the year before. Citi also downgraded the stock from ‘buy’ to ‘hold’.
Banking stocks were in favour, with Citi, Bank of America and JPMorgan Chase edging higher.