[New York Stock Market] Mixed Close Ahead of CPI Announcement... Dow Down 0.26%, Nasdaq Up 0.98%

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] On the 10th (local time), a day before the release of the US Consumer Price Index (CPI) for April, the US New York stock market closed mixed as rebound buying continued following three consecutive days of sharp declines.

On the day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 32,160.74, down 0.26% (84.96 points) from the previous session. The S&P 500 index rose 0.25% (9.81 points) to 4,001.05, and the tech-heavy Nasdaq Composite index ended trading up 0.98% (114.42 points) at 11,737.67.

The three major indices showed a strong upward trend from the opening due to rebound buying following three consecutive days of declines. After showing large volatility with repeated ups and downs, the sharply falling S&P 500 and Nasdaq indices rebounded, but the Dow closed lower just before the close, marking four consecutive days of decline. The S&P 500 regained the 4,000 level, which had been broken for the first time in a year the previous day.

The market is focusing on the April CPI release. Bloomberg reported, "Inflationary pressures remain high but are expected to have eased in April." The drop of the 10-year Treasury yield below 3% also partially improved investor sentiment.

Although aggressive rate hike remarks from Federal Reserve Bank presidents were made one after another on the day, the market did not react significantly.

John Williams, President of the New York Federal Reserve Bank, said that a 50 basis point (0.5 percentage point) rate hike should be considered at the Federal Open Market Committee (FOMC) regular meetings in June and July. Loretta Mester, President of the Cleveland Fed, also said that a 50 basis point rate hike in the next two meetings is "very reasonable." Both Fed presidents also indicated that they do not rule out the possibility of a 75 basis point hike.

Experts in the New York stock market expect market volatility to continue for the time being. However, there is also hope that if the CPI indicator slows down, the market's selling pressure may ease.

Mark Haefele, Chief Investment Officer (CIO) of UBS, advised, "Despite forecasts that inflation will decline and growth will continue, investors should prepare for additional stock volatility due to major economic variables and large movements in the bond market." Richard Sepherstein, CIO of Treasury Partners, said, "The stock market will find a bottom when the Fed stops tightening, inflation rise slows, or some stocks become very attractive."