US indices dived at the start of this week's last trading session due to the reading of the highest US inflation since 1981. Market expected headline price growth to stay unchanged at 8.3% YoY. However, there were some rumors that reading may actually be higher than that amid impact of rising fuel prices, among others. Indeed, it was so. Headline price growth accelerated to 8.6% YoY. On month-over-month basis, headline price growth increased 1.0% MoM (exp. 0.7% MoM). On the other hand, core gauge decelerated but less than market expected. The reading is likely to reinforce need for future rate hikes and may shelf discussions over rate hike pause in September. We also learned very weak data on Michigan sentiment and inflation expectations in the short and long term, which reinforced the scale of the declines. At the moment all Wall Street indices are losing over 2%.
US Univ. Of Michigan Sentiment Jun P: 50.2 (est 58.1; prev 58.4)
- Current Conditions: 55.4 (est 62.9; prev 63.3)
- Expectations: 46.8 (est 55.3; prev 55.2)
- 1-Year Inflation: 5.4% (est 5.3%; prev 5.3%)
- 5-10 Year Inflation: 3.3% (prev 3.0%)
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US100 Index, D1 interval. The US technology benchmark broke below support at 12,500 points and is now down more than 3.3%. Currently, the most important support is the area of the minimums from May this year. Source: xStation 5
Market News:
Yields on 10-year U.S. Treasury bonds jumped to 3.08%.
China once again intends to conduct a lockdown of millions of Shanghai residents, who will be subjected to mass testing on July 11.
Goldman Sachs (GS.US) lowered its recommendation for Netflix (NFLX.US) stock from neutral to sell with a price target of $186 (previously it was $265). The Bank similarly lowered its recommendations for Roblox (RBLX.US) and eBay (EBAY.US).
Stitch Fix (SFIX.US) and DocuSign (DOCU.US) are off more than 20% today following the release of weak financial results and a plan to lay off more than 15% of full-time employees at Stitch Fix.
Most Active Securities; USA. Source: Bloomberg
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