US open: Stocks lowers as investors digest hotter-than-expected CPI reading

(Sharecast News) - Major indices were in the red early on Tuesday open as investors digested a hotter-than-expected inflation reading and assessed fresh comments from Federal Reserve governor Christopher Waller, who signalled that further monetary tightening remains on the table.

As of 1515 GMT, the Dow Jones Industrial Average was down 0.37% at 52,195.83, while the S&P 500 shed 0.17% to 7,536.83 and the Nasdaq Composite came out of the gate 0.03% softer at 25,245.07.

The Dow opened 193.92 points lower on Tuesday, taking a bite out of solid gains recorded in the previous session.

The Bureau of Labor Statistics' closely watched consumer price index rose less sharply in October, offering some relief after September's reading but still coming in stronger-than-expected as higher food and energy costs continued to put pressure on households. The BLS' headline consumer price index increased 0.4% month-on-month in October, slowing from September's 0.6% rise, while core CPI, which strips out volatile food and energy costs, rose 0.3%, matching the pace seen in both August and September. Economists expected to see headline inflation rise 0.3% month-on-month last month, slowing from September's 0.6% increase. Core inflation was forecast to increase 0.2%, compared with 0.3% in the prior month.

Housing costs remained a key driver of inflation, with the shelter index rising 0.3% and accounting for more than 30% of the monthly increase in headline prices, while food prices rose 0.5%, with grocery prices up 0.4% and food away from home also increasing 0.5%. Energy prices increased 0.7% during the month, following a 5.2% jump in September. Petrol prices rose 1%, while electricity costs increased 0.9%, partially offset by a 0.8% decline in natural gas prices.

October's CPI reading comes hot on the heels of comments from Christopher Waller, who said he was leaning towards supporting an interest rate increase at the Fed's December meeting, citing persistent inflationary pressures. The policymaker also indicated he would be open to a larger-than-expected 50 basis point move should inflation data come in above forecasts, warning that a smaller increase could risk damaging the central bank's credibility.

Elsewhere on the macro front, the National Federation of Independent Business' small business optimism index edged down to 97.8 in October from 97.9 in September, marking its lowest reading since June but coming in broadly in line with expectations. The NFIB said sentiment among small business owners was little changed during the month as firms continued to grapple with ongoing challenges. Labour availability remained the biggest concern for a fourth consecutive month, although the proportion of owners citing labour quality or availability as their most significant operating problem eased by one percentage point to 25%. Taxation concerns, however, increased notably, with 21% of respondents identifying taxes as their single biggest issue, the highest proportion recorded since May 2021.

In the corporate space, cloud infrastructure technology firm CoreWeave will report quarterly earnings after the close.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Intel Corp. (INTC) $60.42 5.18%

Cisco Systems Inc. (CSCO) $98.44 2.66%

Amgen Inc. (AMGN) $461.78 0.81%

Goldman Sachs Group Inc. (GS) $915.20 0.58%

Unitedhealth Group Inc. (UNH) $399.25 0.45%

Travelers Company Inc. (TRV) $396.72 0.40%

American Express Co. (AXP) $326.47 0.19%

JP Morgan Chase & Co. (JPM) $343.33 0.14%

Coca-Cola Co. (KO) $96.00 0.02%

Dowdupont Inc. (DWDP) $0.00 0.00%

Dow Jones - Fallers

Nike Inc. (NKE) $38.68 -3.01%

Caterpillar Inc. (CAT) $583.72 -2.52%

Dow Chemical Co. (DOW) $30.48 -1.71%

Merck & Co. Inc. (MRK) $146.76 -1.34%

Home Depot Inc. (HD) $350.34 -1.19%

McDonald's Corp. (MCD) $278.80 -1.18%

Walt Disney Co. (DIS) $117.66 -1.12%

3M Co. (MMM) $187.15 -0.76%

Microsoft Corp. (MSFT) $543.26 -0.73%

Verizon Communications Inc. (VZ) $45.63 -0.68%

S&P 500 - Risers

Advanced Micro Devices Inc. (AMD) $536.64 11.11%

Lam Research Corp. (LRCX) $227.30 10.88%

KLA-Tencor Corp. (KLAC) $153.63 7.82%

Broadcom Inc. (AVGO) $332.83 7.76%

Seagate Technology Plc (STX) $502.66 7.57%

Ipg Photonics Corp. (IPGP) $69.67 7.56%

Western Digital Corp. (WDC) $292.65 6.86%

Microchip Technology Inc. (MCHP) $62.92 6.35%

Applied Materials Inc. (AMAT) $380.13 5.76%

Micron Technology Inc. (MU) $742.63 5.55%

S&P 500 - Fallers

Coterra Energy Inc. (CTRA) $32.56 -8.62%

Under Armour Inc. Class A (UAA) $5.21 -5.40%

Under Armour, Inc. (UA) $5.03 -4.73%

Target Corp. (TGT) $159.66 -4.36%

Whirlpool Corp. (WHR) $30.73 -3.86%

Lennar Corp. Class A (LEN) $88.57 -3.80%

Newmont Corporation (NEM) $120.96 -3.76%

Equity Residential (EQR) $63.66 -3.50%

Fortune Brands Innovations, Inc. (FBIN) $50.20 -3.49%

D. R. Horton Inc. (DHI) $150.57 -3.34%

Nasdaq 100 - Risers

Lam Research Corp. (LRCX) $227.30 10.66%

KLA-Tencor Corp. (KLAC) $153.63 8.61%

Broadcom Inc. (AVGO) $332.83 8.36%

Seagate Technology Plc (STX) $502.66 7.57%

Western Digital Corp. (WDC) $292.65 6.86%

Microchip Technology Inc. (MCHP) $62.92 6.84%

Intel Corp. (INTC) $60.42 6.11%

Applied Materials Inc. (AMAT) $380.13 5.76%

Micron Technology Inc. (MU) $742.63 5.55%

Texas Instruments Inc (TXN) $295.43 4.91%

Nasdaq 100 - Fallers

Qvc Group Inc Series A (QVCGA) $0.34 -13.49%

Verisk Analytics Inc. (VRSK) $196.13 -3.64%

Paychex Inc. (PAYX) $113.46 -2.87%

Workday, Inc. (WDAY) $189.65 -1.91%

O'Reilly Automotive Inc. (ORLY) $88.96 -1.80%

Expedia Group Inc. (EXPE) $259.43 -1.69%

Amazon.Com Inc. (AMZN) $271.99 -1.46%

Gen Digital Inc. (GEN) $29.47 -1.42%

Hasbro Inc (HAS) $118.98 -1.20%

Alphabet Inc. Class C (GOOG) $288.23 -1.18%