US Open: CPI reading weighs on American indices (14.10.2026)

Wall Street opened Wednesday's session in the red. The S&P 500 fell 0.8%, while the Nasdaq 100 retreated 1%. The main driver behind the sell-off was a stronger-than-expected September CPI reading, which once again raised expectations of Fed rate hikes - both this year and next.

Inflation Returns to the Forefront

Today's CPI publication proved hotter than the consensus had anticipated. Headline inflation accelerated to 3.7% YoY (up from 3.4% in August), surpassing expectations of 3.6%. Core inflation (excluding food and energy prices) rose to 2.6% YoY against forecasts of 2.5%. Inflation has remained above the Fed's target for 66 consecutive months, with little indication of a swift return to target.

Figure 1: US CPI Inflation and Wage Growth (2021 - 2026)

Source: XTB Research, 14.10.2026

On a monthly basis, the headline measure increased by 0.6% (the fastest pace in five months), while the core measure rose by 0.3%. Unsurprisingly, 3-month momentum for the core measure returned above the Fed's inflation target.

Figure 2: US Core CPI Inflation Momentum (14.10.2026)

Source: XTB Research, 14.10.2026

The scope of the inflationary impulse is also expanding. Prices for over 52% of products grew at a rate exceeding 3% in September, with 35% rising at a rate higher than 4%.

It is worth noting, however, that the sharp rise in the core measure was largely driven by a single component: OER (owners’ equivalent rent). Housing market conditions had been relatively muted in preceding months, naturally raising questions as to whether this increase might be a temporary outlier.

Dollar reaches highest level since May 2025; gold and bonds decline

A strong market reaction to today’s data was visible across foreign exchange markets. All G10 currencies weakened against the US dollar, including the euro, which fell approximately 0.7%. The EUR/USD pair is approaching the 1.11 level.

Figure 3: Major Currency Performance [vs. USD] (05.10.2026 - 14.10.2026)

Source: XTB Research, 14.10.2026

This reaction follows a significant increase in bets on the Fed continuing its tightening cycle at the October meeting. Only yesterday, markets assigned a relatively low probability to such an outcome via futures contracts pricing, but expectations have now converged towards 50%.

Predictably, US Treasury yields moved higher. Benchmark 10-year yields briefly touched 5.33% before settling near 5.27%. Two-year yields, which are substantially more sensitive to inflation expectations, spiked to 4.95% before easing to around 4.86%.

Figure 4: US 10-Year Treasury Yield and WTI Crude Oil (06.2026 - 10.2026)

Source: XTB Research, 14.10.2026

Precious metals, acting as direct alternatives to US government debt, faced selling pressure. Gold declined 2% towards $4,075 per troy ounce, whilst silver dropped 6% to $55.60.

Figure 5: Gold (2026)

Source: XTB Research, 14.10.2026

Rising bond yields naturally created headwinds for major equity indices as well.

Semiconductor sell-off accelerates

Alongside the CPI release, the ongoing sell-off in semiconductor stocks served as the second key theme of the trading session. The SOXX Index tumbled 4%, extending its 5-day decline to over 10%.

Investors are increasingly questioning the sustainability of the artificial intelligence investment boom, with elevated debt levels across the sector, higher interest rates, stretched valuations, and intensifying competition (including from Chinese competitor CXMT) causing concern.

Figure 6: Nasdaq 100 Gainers and Losers (14.10.2026)

Source: XTB Research, 14.10.2026

A further potential catalyst for market sentiment will be Anthropic's meeting with selected investors in San Francisco later today, organised as part of preparations for its prospective IPO. Wall Street will be looking for guidance regarding revenue growth trajectory to better gauge market appetite for continued AI capital expenditure.

Figure 7: S&P 500 Gainers and Losers (14.10.2026)

Source: XTB Research, 14.10.2026

Corporate News

Bank of America ($BAC.US)

Shares in the bank dropped over 5% today, putting the firm on track for its worst session on the spot market since April 2025. The sharp sell-off was primarily driven by lower-than-expected revenue reported in today's quarterly earnings release. Results in trading and fixed income fell short of analysts' expectations, whilst the institution also faced regulatory penalties related to anti-money laundering and sanctions compliance deficiencies.

Progressive ($PGR.US)

Shares in the insurer dropped 6% despite net written premiums for the third quarter meeting analysts' forecasts.

State Street ($STT.US)

Net revenue for the third quarter fell short of expectations, with the firm recording an unexpected cash outflow of $62bn. Shares fell 6.4%.

BlackRock ($BLK.US)

The world's largest asset manager posted modest gains today. The firm attracted $205bn in net new inflows during the third quarter, alongside acceleration in revenue growth.

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Michał Jóźwiak, Financial Markets Analyst at XTB