Stocks rose on Tuesday morning as investors digested better-than-expected inflation numbers, which kicked off days of key economic reports that could provide clues as to when the Federal Reserve will begin cutting interest rates.
The S&P 500 and Nasdaq Composite rose 0.8% and 1.4%, respectively, while the Dow Jones Industrial Average gained 0.3%. On Monday, the S&P 500 and Nasdaq closed slightly higher, extending their winning streaks for three consecutive sessions, as markets steadied following a volatile stretch fueled by mounting concerns about the health of the U.S. economy.
The producer price index report released early on Tuesday showed further improvement in headline inflation, seen as a leading indicator of consumer prices. The consumer price inflation report comes on Wednesday, followed by retail sales and housing data later in the week. Several central bank officials are scheduled to speak in the coming days.
Economic data is closely watched by the central bank as it considers when to start cutting rates, which have been on a two-decade high. Federal Reserve Chairman Jerome Powell said the central bank will start cutting its key lending rate in September if inflation continues to moderate.
The yield on 10-year Treasuries was at 3.87%, falling below 3.9% on Tuesday for the first time since last Wednesday. A weaker-than-expected July jobs report fell below 3.7% earlier last week, prompting market participants to believe the central bank should cut rates sooner and address deeper economic weakness. Concerns eased later in the week when jobless claims numbers turned more favorable,
Starbucks ( SBUX ) was the big mover in early trading, rising more than 20% after the company announced that Chipotle ( CMG ) CEO Brian Nichol will join the coffee chain as CEO. Shares of Chipotle fell more than 10%.
Shares of large-cap tech stocks rose in early trade, with Nvidia ( NVDA ) up 4%, Apple ( AAPL ), Microsoft ( MSFT ), Amazon ( AMEZN ), Alphabet ( Google ) and Meta Platforms ( META ). is increasing.
Home Depot ( HD ), part of the Dow, rose slightly after the earnings report. The home improvement retailer said its 2024 comparable sales will fall more than previously forecast, offsetting second-quarter sales and profit.
Gold futures rose slightly to $2,510 an ounce, nearing a new record high, while bitcoin was steady above $59,000.