The Market Is Down After Second-Highest Close

Yesterday, the stock market closed at its second-highest level ever. Today, the market has pulled back some. This morning’s CPI report showed that both headline and core inflation rose by 0.2% last month.

The Labor Department said on Tuesday its consumer price index increased 0.2% last month after gaining 0.4% in August. The CPI advanced 0.6% in both June and July after falling in the prior three months as business closures to slow the spread of the coronavirus weighed on demand.

In the 12 months through September, the CPI increased 1.4% after rising 1.3% in August. Economists polled by Reuters had forecast the CPI climbing 0.2% in September and rising 1.4% year-on-year.

That’s not bad and it indicates that inflation isn’t heating up despite the Fed’s new permissive attitude. As I write this, the S&P 500 is off by about 0.60%.

Disney got a nice boost today thanks to its reorg announcement. At one point, shares of the Mouse House were up over 5%.

Here’s a chart of headline inflation:

Posted by on October 13th, 2020 at 3:13 pm


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