US open: Stocks higher as markets recover from post-CPI sell-off
By Iain Gilbert
Date: Wednesday 14 Feb 2024
(Sharecast News) - US stocks opened higher on Wednesday as major indices attempted to bounce back from yesterday's CPI-fuelled heavy sell-off.
As of 1525 GMT, the Dow Jones Industrial Average was up 0.33% at 38,399.35, while the S&P 500 advanced 0.74% to 4,990.01, and the Nasdaq Composite came out the gate 0.97% firmer at 15,808.07.
The Dow opened 126.60 points higher on Wednesday, taking only a small bite out of losses recorded in the previous session as hotter-than-expected inflation data led to a sell-off that saw the Street register its worst day since March 2023 as traders worried that the Federal Reserve may not cut interest rates quite as early as initially hoped.
The consumer price index gained 0.3% in January versus December and was 3.1% higher year-on-year, with economists originally expecting to see a 0.2% and 2.9% increase, respectively. This means January's CPI reading likely pushes the likelihood of the central bank making any changes to interest rate policy out to the second half of the year - later than previous expectations of a rate cut taking place as early as March.
On the macro front, mortgage applications fell 2.3% in the week ended 9 February, according to the Mortgage Bankers Association, cutting into the prior week's 3.7% increase and marking the second fall in mortgage demand so far this year. Applications to purchase a home fell 3% week-on-week, while those to refinance a home dropped 2%.
Still to come, Federal Reserve governor Michael Barr will deliver a speech at 2100 GMT.
In the corporate space, Lyft traded higher in pre-market after the ride-sharing giant reported stronger-than-expected quarterly earnings, while online accommodation booking platform operator Airbnb was trading lower despite the company posting results that beat revenue expectations for its latest quarter.
Kraft-Heinz beat earnings per share estimates by a single cent but said revenues had fallen short of expectations amid market headwinds.
Elsewhere, Bitcoin was trading more than 4% higher at the open, hitting its highest level in two years and pushing the bellwether cryptocurrency's market cap back over $1.0trn as the growing success of US spot bitcoin ETFs lifted investor sentiment.
Reporting by Iain Gilbert at Sharecast.com
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