Stocks ended the day down after the release of the consumer price index today, which raised worries that the Fed would have to reduce asset purchases and consider raising interest rates sooner. All three major indices ended down. Yields on the 10 year Treasury note increased to 1.425%. Although some major banks reported large profits for the second quarter, this was largely ignored by investors and shares of JPM and GS dropped despite earnings beating expectations.
The Bureau of Labor Statistics today reported that the Consumer Price Index increased by 0.9% after a 0.6% increase in May. This was the largest one month increase since June 2008. The largest increase was in used motor vehicles. The core CPI, which excludes food and energy, was up 0.9% after a 0.7% increase in May. Estimates were 0.5% for the CPI and 0.4% for the core.
The core CPI has increased at an annualized rate of 8% for the 3 months up to and including June.
Year over year, the increase was 5.4%, the largest since August 2008. The forecast increase was 4.9%. The 12 month index has been rising since the January value of 1.4%. Excluding food and energy, the year over year index increased 4.5%, the most since November 1991.
The higher and higher inflation numbers over the past months are testing the Fed’s contention that the inflation will be transient and related to opening up constrictions in the supply chain leading to inventory shortages.
The SP 500 dropped by 0.35% to close at 4369.21. The index is up 0.59% over five days, up 2.89% over one month, up 5.50% over three months and up 36.64% over one year.
The trailing P/E is 37.70 compared with 27.95 one year ago and estimated future P/E 22.72. Dividend yield is currently 1.33 compared with 1.94 one year ago.
Leading stocks were PEP up 2.31%, TDY up 2.30%, MA up 2.20%, V up 1.94% and ADSK up 1.54%.
Trailing stocks were CAG down 5.34%, HPE down 4.98%, Franklin Resources Inc down 4.89%, NCLH down 4.36% and BA down 4.23%.
The Dow Jones industrial Average dropped by 0.31% to close at 34888.79. The DOW is up 0.90% over five days, down 1.72% over one month, up 3.60% over three months and up 30.95% over one year.
The trailing P/E is 29.06 compared with 22.58 year ago and an estimated future P/E of 20.16. The current dividend yield is 1.79% compared with 2.49 one year ago.
Leading stocks were DIS up 4.15%, GS0 up 2.35%, JPM up 1.43%, INTL up 1.32% and AXP up 0.97%.
Trailing stocks were CSCO down 0.95%, CRM down 0.88%, MRK up 0.56%, BA up 0.54%, and MMM up 0.51%.
The NASDAQ composite dropped by 0.38% and closed at 14677.65. NASDAQ has been up 0.10% over five days, up 4.30% over one month, up 4.87% over 3 months and up 39.94% over one year.
Leading stocks were AHPI up 128.79%, RCAT up 60.27%, OSAT up 40.33%, SOHU up 27.58% and PLXP up 27.19%.
Trailing stocks were SGOC down 52.05%, MDIA down 51.18%, CPOP down 26.31%, MTSL down 26.15%, and VIVO down 22.89%.
The MidCap SP400 dropped by 1.53% to close at 2671.76. The SP400 is down 0.30% for the past 5 days, down 1.92% for the past month, up 0.16% for the past 3 months and up 49.88% over the past year.
Leading stocks were WING up 2.06%, EVR up 1.74% and MIDD up 1.36%.
Trailing stocks were CNK down 7.11%, STAA down 5.62% and TPH down 4.91%
The SmallCap SP600 dropped by 1.92% to close at 1338.99. The SP600 is down 0.79% for the past 5 days, down 3.70% for the past month, up 0.92% for the past 3 months and up 62.70% over the past year.
Leading stocks were PLAB up 4.68%, BNED up 3.58% and SNBR up 3.50%.
Trailing stocks were VIVO down 22.89%, SLP down 17.55% and AMEH down 13.27%.
The CBOE VIX is up by 5.88% and closed at 17.12. The VIX is up 414% over five days, up 0.59% over one month, up 2.82% over three months and down 42.01% over one year.
On the New York stock exchange 835 stocks advanced and 2484 declined, while on Nasdaq 1073 advanced and 3294 declined.
There were 140 new 52 week highs and 19 new 52 week lows on NYSE with 128 new highs and 75 new lows on NASDAQ.
The 2 year Treasury note yield is 0.269% and 10 year is 1.424%. The 10 year yield is up 7.3% over five days, down 4.93% over one month, down 12.17% three months ago, and up 127.61% one year ago.
SP500 Sector Performance % change
Information Technology +0.44
Consumer Staples -0.04
Communication Services -0.11
Health Care -0.11
Consumer Discretionary -1.18
Real Estate -1.36
Information Technology has been up 1.00% over five days, up 6.80% over one month, up 6.66% over three months and up 41.73% over one year.
Real Estate has been up 1.29% over five days, up 1.38% over one month, up 11.99% over three months and up 32.38% over one year.