U.S. stocks were trading down Tuesday morning, as investors look to the widely anticipated reading on August inflation from the consumer-price index on Wednesday and traders kept their powder dry ahead of Apple’s marketing event.
How stock indexes are trading
-
The Dow Jones Industrial Average
DJIA
fell almost 51 points, or 0.2%, to around 34,613. -
The S&P 500
SPX
dropped 20 points, or 0.5%, to 4,467. -
The Nasdaq Composite
COMP
shed 102 points, or 0.7%, to about 13,816.
What’s driving markets
U.S. stocks were slipping Tuesday, as traders appeared reluctant to make bold bullish bets ahead of potential market catalysts on Tuesday and Wednesday.
On Tuesday afternoon, Apple will release of its new iPhones. The technology giant’s shares were down more than 1% in late morning trade as investors wait to see what the world’s biggest listed company has in store at its marketing event, scheduled to start at 1 p.m. Eastern Time.
Read also: The iPhone 15 is coming: Everything to expect from Apple’s big event
“Welcome to my annual day of being seduced into buying a new iPhone that I don’t really need but desperately want,” said Jim Reid, strategist at Deutsche Bank. “Apple launch their new product suite today which actually is a potential macro mover.”
Most of the S&P 500 index’s 11 sectors were trading down Tuesday morning, with information technology seeing the biggest decline at around 1.2%, according to FactSet data, at last check. Tech has the heaviest weight in the S&P 500 index.
Looming inflation
Meanwhile, investors are looking ahead to a reading on August inflation, as measured by the consumer-price index, or CPI, on Wednesday morning before the U.S. stocks market’s open.
“CPI remains the most important monthly economic metric for the simple reason that if CPI does not continue to decline, markets will have to price in a more hawkish Fed, and that would be a headwind on stocks,” said Tom Essaye, founder and president of Sevens Report Research, in a note Tuesday.
“Sensitivity to this report will be especially high tomorrow because there have been anecdotal signs that inflation may be leveling off or bouncing back,” he said.
A “good” CPI report would show core inflation, which excludes energy and food prices, rose 0.2% or less in August, according to Essaye. Economists polled by the Wall Street Journal have forecast that core CPI rose 0.2% last month and 4.3% year over year.
Core inflation had climbed 4.7% in the 12 months through July, as measured by the consumer-price index.
“A continued drop in core CPI will help to calm concerns that inflation is bouncing
back, and that could trigger a solid drop in Treasury yields and a good relief rally in stocks,” said Essaye.
See: Inflation is set for a big increase, CPI to show. Here’s why.
Companies in focus
-
Apple stock
AAPL,
-1.23%
was down 0.7% ahead of the presentation of its new iPhone. -
Oracle Corp.
ORCL,
-12.09%
dropped more than 13% after the cloud database company’s issued revenue outlook fell below Wall Street expectations. -
Canopy Growth Corp.
CGC,
-14.50%
shares are tumbling more than 12% after a sharp jump earlier built on growing hopes that the federal government will ease laws on cannabis.
Jamie Chisholm contributed to this report
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