Wall Street falls ahead of CPI inflation data
By Bansari Mayur Kamdar and Johann M Cherian
(Reuters) -Wall Street's main indexes fell on Wednesday ahead of a key inflation report this week, with investors also assessing remarks from U.S. Federal Reserve officials.
Rate-sensitive megacap growth and technology stocks, that have led the Wall Street rally this year, such as Nvidia (NASDAQ:NVDA), Apple (NASDAQ:AAPL) and Tesla (NASDAQ:TSLA) were down between 1.3% and 4.6%.
«We think that at this point there is some profit taking and retrenchment in the short term on the card,» said Aadil Zaman, partner at Wall Street Alliance Group.
Philadelphia Fed President Patrick Harker said on Tuesday the U.S. central bank may be at the stage where it can leave interest rates unchanged, barring any abrupt change in the direction of recent economic data.
However, Fed Governor Michelle Bowman on Monday said the combination of still-elevated inflation and continued economic growth meant further rate increases are likely.
Traders expect an 86.5% chance of no rate hike at the Fed's next policy meeting in September, according to CME FedWatch Tool.
The Consumer Price Index (CPI) for July, due on Thursday, is expected to show a slight year-over-year acceleration. On a month-to-month basis, consumer prices are seen increasing 0.2%, the same rate as in June.
«CPI won't be major surprise. It's going to be either matching expectations most likely or slightly better than expectation, showing that inflation is cooling off,» Zaman added.
Wall Street's main indexes ended the previous session lower in a broad selloff after the downgrading of several small and mid-sized banks by credit rating agency Moody's (NYSE:MCO).
Big banks extended losses on Wednesday, with Bank of America (NYSE:BAC) and Wells
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