US OPEN: Wall Street retreats after downbeat PPI reading

3:52 PM 9 December 2022
  • US indices launched today's cash trading lower
  • US PPI eases less than expected
  • Lululemon (LULU.US) stock plunges on weak financial outlook

Three major Wall Street indices fell slightly at the beginning of Thursday's session and are heading for weekly losses as latest US PPI figures showed that inflation is easing but at a slower pace than market anticipated, which lowers expectations that the Fed will slow its aggressive tightening campaign. Today's report points to a rather small chance that next week's CPI will drop below 7%. 

S&P 500 index stocks categorized by sectors and industries. Size represents market cap. Source: xStation5

US30 hovers around key support at 33720 pts which coincides with 61.8% Fibonacci retracement of the last downward correction launched early January 2022. As long as price sits above, continuation of upward move is possible. Nearest resistance to watch lies at 34330 pts. On the other hand, if sellers manage to regain control, then another downward impulse towards major support at 32620 pts may be launched. Source: xStation5

Company news:

Lululemon (LULU.US) shares fell over 7.0% in the premarket as weak financial outlook overshadowed upbeat quarterly results. The athletic apparel maker also reported a smaller-than-expected increase in comparable store sales.

Lululemon (LULU.US) stock launched today's session with a massive bearish price gap and is currently trading below major support at $350.00, which now acts as the first line of resistance. If current sentiment prevails, downward move may deepen towards next support at $308.00 which coincides with 50.0% Fibonacci retracement of the upward wave launched in March 2020. Source: xStation5

DocuSign (DOCU.US) shares surged more than 11.0% in off-hours trading after the software company recorded solid quarterly results. Company said that billings — a metric that tracks sales to new customers - rose 17% on YoY basis.

Netflix (NFLX.US) stock jumped nearly 3.0% before the opening bell after Wells Fargo upgraded its stance on the streaming giant to 'overweight' from 'equal weight', noticing clear improvement of its content.

Costco Wholesale (COST.US) stock fell 0.8% in premarket after the warehouse club operator posted disappointing financial guidance as elevated price pressures negatively affected consumers spending while operating expenses increased.

Li Auto (LI.US) stock dropped 0.6% ahead of the US open after the Chinese  EV producer recorded another loss in Q3 due to higher input costs and production disruption caused by covid restrictions.

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