US STOCKS-Wall St eyes lower open as inflation data stokes rate hike worries

US STOCKS-Wall St eyes lower open as inflation data stokes rate hike worries
US STOCKS-Wall St eyes lower open as inflation data stokes rate hike worries

Fears that the Federal Reserve might prolong its aggressive interest rate hikes were fueled by a higher-than-anticipated rise in monthly producer prices, which caused Wall Street benchmark indexes to open lower on Friday.

The Work Division’s report showed maker costs rose 7.4% keep going month on a yearly premise contrasted and financial specialists’ assumptions for 7.2%, in spite of the fact that lower than the 8% ascent found in October.

Core producer prices, which do not include volatile components like food and energy, increased by 6.2% in comparison to estimates of a 5.9% increase.

“It is frustrating and it shows that we are stuck on the treadmill of expansion and I’m not amazed to see the market auction like it is at this moment,” said Robert Pavlik, senior portfolio administrator at Dakota Abundance in Fairfield.

The central bank’s plans for monetary tightening next week will be further clarified by Tuesday’s release of consumer prices data.

As a result of the data,

U.S. Treasury yields increased, and the majority of mega-cap technology and growth stocks, such as Alphabet Inc. GOOGL.O, Nvidia Corp. NVDA.O, Tesla Inc. TSLA.O, and AMZN.O, fell between 0.3 and 1.3 percent in premarket trading. The strong monthly jobs and service-sector activity reports from last week and the strong US/Producer Prices data have raised concerns about aggressive rate hikes.

The report also showed that the underlying trend of inflation had moderated, and expectations for a 50-basis-point Fed rate hike next week remained roughly the same. FEDWATCH Through November, the U.S. central bank has increased its policy rates by 75 basis points for four consecutive months to 3.75 percent-4.00%.

After two months of gains, Wall Street’s main indexes have been under pressure in December due to concerns about a possible recession next year fueled by prolonged U.S. rate hikes and negative comments from top executives.

After data showed that initial jobless claims rose slightly last week, suggesting the labor market was deteriorating, U.S. stocks recovered from their recent losses on Thursday.

After falling in November, the preliminary December reading of the overall consumer sentiment index from the University of Michigan is anticipated to have improved. Data are due at 10:00 a.m. Eastern Time.

Dow e-minis 1YMcv1

was down 154 points, or 0.46 percent, at 8:45 a.m. ET, S&P 500 e-minis EScv1 was down 22 points, or 0.55%, and Nasdaq 100 e-minis NQcv1 was down 72.75 points, or 0.62%.

Carvana Co CVNA.N dropped 8% after Jefferies halved the price target for the used-car retailer’s stock, while Netflix Inc. NFLX.O gained 2.2% after Wells Fargo upgraded the streaming giant’s stock to “overweight” from “equal weight.”

After the chipmaker predicted revenue that would exceed Wall Street estimates for the current quarter, Broadcom Inc. AVGO.O saw a slight increase of 2.8%.

After the athletic apparel manufacturer predicted lower-than-anticipated holiday quarter revenue and profit, Lululemon Athletica Inc. LULU.O fell 7.2%.
Bilibili Inc. BILI.O rose 3.6%, while Baidu Inc. BIDU.O, the largest search engine, gained 2.3%.

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