US benchmark equity indexes showed gains during intraday trading after official data revealed that consumer inflation has accelerated in line with Wall Street's projections last month. The Nasdaq Composite reported an increase of 1.8%, reaching 20,003.8 mid-Wednesday, while the S&P 500 saw a 0.9% rise to 6,090.3.
The Dow Jones Industrial Average edged up 0.1%, hitting 44,306.6. Among the various sectors, communication services led the way in gains, whereas health care experienced the largest decline. In recent economic updates, the US consumer price index increased by 0.3% in November, up from 0.2% during each of the prior four months, as reported by the Bureau of Labor Statistics.
Year-over-year, inflation rose to 2.7%, compared to October's rate of 2.6%. These figures aligned with expectations outlined in a Bloomberg-compiled survey. TD Economics noted, "The November CPI report provided further evidence that inflation progress is becoming much more incremental, suggesting the Federal Reserve's fight to return to 2% inflation is far from over." Expectations for a 25-basis-point reduction in interest rates next week surged to nearly 95% on Wednesday, a rise from 89% observed on Tuesday, according to the CME FedWatch tool.
Additionally, the official producer prices report for November is set to be released on Thursday. In the mortgage sector, applications in the US continue to follow an upward trajectory, driven by refinance activity as rates have decreased across most loan types, as stated by the Mortgage Bankers Association on Wednesday. Intraday, the yield on the US 10-year bond increased by 2.7 basis points to 4.25%, while the two-year rate witnessed a decrease of one basis point to 4.14%. In corporate news, Apple is collaborating with Broadcom as part of the development of its initial server chip tailored specifically for artificial intelligence, according to The Information, which cited unnamed sources.
Broadcom shares jumped 5.6%, making it the top performer on the Nasdaq and one of the best on the S&P 500, while Apple's shares increased by 0.6%. Albertsons terminated its proposed $25 billion acquisition by Kroger after two courts ruled to block the deal, leading the grocery chain to sue Kroger for allegedly failing to secure regulatory approval.
Kroger's shares advanced by 0.9%, while Albertsons fell by 0.7%. Companies like Adobe and Nordson are set to announce their latest quarterly financial results after the market closes on Wednesday. Meanwhile, West Texas Intermediate crude oil climbed 2% to $69.94 a barrel during intraday trading. The Organization of the Petroleum Exporting Countries adjusted its 2024 and 2025 global oil demand projections downward for the fifth consecutive month, attributing much of the revision for 2024 to recently received bearish data for Q3. Precious metals saw gains as well, with gold rising 1.4% to $2,757.60 per troy ounce and silver adding 0.7% to $32.97 per ounce..