New York Stock Market Slightly Rises Early Session... October Wholesale Prices 'In Line with Expectations'

Seeking Additional Upside Momentum After Trump Rally
October PPI Rises 0.2% MoM
Last Week's Unemployment Claims Lowest in 6 Months
Focus on Fed Chair Jerome Powell's Speech This Afternoon

The three major indices of the U.S. New York Stock Exchange showed a firm upward trend in early trading on the 14th (local time). After the presidential election, the market, which had been hitting record highs day after day due to the 'Trump rally,' appears to be taking a breather as investors await new momentum for further gains. Investors digested the wholesale price index released in the morning, which met expectations, and are now awaiting remarks from Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), scheduled for the afternoon.

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As of 9:35 a.m. in the New York stock market, the blue-chip-focused Dow Jones Industrial Average rose 0.19% from the previous trading day to 44,042.45. The large-cap-focused S&P 500 index was up 0.11% at 5,992.03, and the tech-heavy Nasdaq index was trading 0.18% higher at 19,265.43.

By individual stocks, Walt Disney, which announced fourth-quarter fiscal year results exceeding expectations, surged 10.86%. Tesla, led by CEO Elon Musk, a close associate of President-elect Donald Trump and the future head of the government efficiency department, was down 0.42%. Nvidia rose 0.39%, and Apple was up 0.52%.

Investors focused on the Producer Price Index (PPI), a wholesale price indicator released that morning. According to the U.S. Department of Labor, the PPI for October rose 0.2% month-over-month. This was a slight increase from September's 0.1%, but matched experts' expectations of 0.2%. The annualized PPI for the past 12 months rose 2.4% in October, a significant increase from 1.9% in September. The core PPI, which excludes volatile food and energy prices to show the underlying inflation trend, rose 0.3% month-over-month and 3.1% year-over-year. The wholesale price index PPI is considered a leading indicator of the Consumer Price Index (CPI), which affects retail prices with a time lag. The CPI for October, released the previous day, showed a 2.6% increase year-over-year. Although housing costs and food prices rose, pushing the figure up 0.2 percentage points from 2.4% in September, it met market expectations. The core CPI rose 3.3% year-over-year, matching forecasts.

Although inflationary pressures slightly increased last month, they were in line with market expectations, leading investors to maintain their outlook for a small Fed rate cut (0.25 percentage points) next month. According to the Chicago Mercantile Exchange (CME) FedWatch, the federal funds futures market reflected a 79.1% probability that the Fed will cut rates by 0.25 percentage points at the December Federal Open Market Committee (FOMC) meeting, similar to the 82.5% probability seen the previous day.

Expectations for a rate cut next month also led to a slight decline in U.S. Treasury yields. The 10-year U.S. Treasury yield, a global bond rate benchmark, fell 2 basis points (1 bp = 0.01%) from the previous trading day to 4.42%, while the 2-year Treasury yield, sensitive to monetary policy, dropped 3 basis points to around 4.25%.

Last week, initial jobless claims decreased compared to the previous week, hitting a six-month low. According to the U.S. Department of Labor, initial jobless claims for the week of November 3-9 totaled 217,000, down 4,000 from the revised previous week. This was the lowest level since May and 7,000 below experts' expectations of 224,000. Continuing claims, which count those claiming unemployment benefits for at least two weeks, stood at 1,873,000 for the week of October 27 to November 2, below both the revised previous week's 1,884,000 and market expectations of 1,880,000.

The market is searching for new upward momentum as the Trump rally has paused. Courtney Garcia, senior advisor at Payne Capital Management, said, "I don't think the rally will end in the short term," adding, "If there is new money, there are still many opportunity areas with room to run."

Investors are focusing on Chairman Powell's speech scheduled for the afternoon. Attention is also on the October retail sales data to be released the following day.

International oil prices are steady. West Texas Intermediate (WTI) crude oil rose $0.14 from the previous trading day to $68.57 per barrel, while Brent crude, the global oil price benchmark, increased $0.17 to $72.45 per barrel.