New York, September 12, 2023 – U.S. stocks opened lower on Tuesday, as investors awaited key inflation data that could provide clues about the future course of interest rates.
Wall Street-Image Source: Sky News
The Dow Jones Industrial Average fell 0.13%, or 43.70 points, to 34,620.02. The S&P 500 declined 0.32%, or 14.19 points, to 4,473.27. The Nasdaq Composite dropped 0.42%, or 58.96 points, to 13,858.94.
The declines came as investors awaited the release of the Consumer Price Index (CPI) for July, which is scheduled for Wednesday. Economists expect the CPI to rise 0.5% from June, but some are forecasting a larger increase of 0.7%.
A higher-than-expected CPI would likely lead to more aggressive interest rate hikes by the Federal Reserve. The Fed has already raised rates twice this year, and it is widely expected to continue to do so at its meeting in September.
“Investors are in a wait-and-see mode ahead of the CPI data,” said Michael Wilson, chief equity strategist at Morgan Stanley. “A higher-than-expected reading could lead to a more hawkish Fed, which would weigh on stocks.”
In addition to the CPI data, investors are also keeping an eye on developments in the U.S. economy. Recent data has showed that economic growth is slowing, which could also lead to a more cautious approach by the Fed.
“The Fed is walking a tightrope,” said Wilson. “It needs to raise rates enough to cool inflation, but it doesn’t want to slow the economy too much.”
