Inflation and unemployment data pushes Wall Street lower
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The news: Wall Street's main indices closed lower as higher-than-expected inflation and unemployment claims renewed concerns on the health of the US economy and the path for interest rates.
The numbers: Among the main indices: the Dow Jones fell 0.14%, the S&P 500 slipped 0.21%, while the Nasdaq edged 0.05% lower. The closely watched US consumer price index rose 0.2% in September and 2.4% on an annual basis, both figures being slightly higher than estimated by economists.
The context: The new economic data prompted traders to price in a roughly 80% probability that the Federal Reserve will cut rates by 25 basis points at its meeting in November, with a roughly 20% chance it would leave rates unchanged.
Atlanta Federal Reserve Bank president Raphael Bostic said he would be "totally comfortable" skipping an interest rate cut at an upcoming meeting, while Chicago Fed president Austan Goolsbee said he sees "gradual" rate cuts over the next year-and-a-half.
Energy outperformed other sectors as oil prices rose, with oil futures rallying as US fuel use spiked ahead of Hurricane Milton, which made landfall on Florida's west coast. Oil prices are also being supported by supply concerns related to conflicts in the Middle East.
In individual stocks, Delta Air Lines fell after it forecast quarterly revenue below expectations in anticipation of slower travel spending. American Airlines also lost ground.
Shares of Pfizer fell as former executives distanced themselves from activist investor Starboard's campaign against the drugmaker.
What they said: "Investors were torn between a stronger than expected CPI report and a weaker than expected unemployment claims report. One showed inflation running hotter than expected and the other showed the economy looking weaker than expected. It's the worst of both worlds," Jack Ablin, chief investment officer at Cresset Capital in Chicago told Reuters.
The source: Reuters
