Wall St set to open higher on signs of easing inflation
By Shreyashi Sanyal and Shristi Achar A
Published 14:31 PM Wed May 10th ,2023
(Reuters) - Wall Street s main indexes were set to open higher on Wednesday as U.S. consumer prices rose at a slightly slower-than-expected pace last month in a sign that the Federal Reserve’s rapid interest rate hikes were yielding result. The Labor Department’s Consumer Price Index (CPI) rose 4.9% in April from a year ago and compared with expectations of a 5% increase. Month-over-month CPI in April rose 0.4% after gaining 0.1% in March. Fed funds futures traders are now pricing in an 86% chance that the Fed will leave rates unchanged in its June meeting and 14% odds of another 25 basis points hike. [FEDWATCH] ’The futures are interpreting that (CPI) being in line will corroborate the idea that the Fed isn’t going to have to raise rates anymore and if that’s the casesaid Thomas Martin senior portfolio manager at GLOBALT Investments. ’You still have a reasonably strong economy and rates that are not going any higher.’ Large-cap technology stocks including Apple Inc (NASDAQ:AAPL) and Microsoft Corp (NASDAQ:MSFT) reversed premarket declines to rise about 0.7% each while U.S. Treasury yields fell after data. [US/] At 8:51 a.m. ET Dow e-minis were up 181 points or 0.54% S and P 500 e-minis were up 33.75 points or 0.82% and Nasdaq 100 e-minis were up 116.25 points or 0.88%. Alphabet (NASDAQ:GOOGL) Inc gained 1.3% as the Google-parent was set to unveil more artificial intelligence in its products to answer the latest competition from Microsoft. Shares of regional banks rose after a few volatile sessions last week on concerns about the health of the sector. PacWest Bancorp added 7% while Zions Bancorporation (NASDAQ:ZION) and Western Alliance (NYSE:WAL) Bank inched up 2.4% and 4.5% respectively. Oil and gas producer Occidental Petroleum Corp (NYSE:OXY) fell 0.9% after its first-quarter earnings fell short of analysts’ estimates. Livent (NYSE:LTHM) Corp added 3.2% in choppy trading after Australian lithium miner Allkem Ltd agreed to merge with the U.S.-based chemical manufacturing firm to create a $10.6 billion firm. Airbnb Inc lost 4.5% as the vacation rental booking company saw fewer bookings and lower average daily rates in the second quarter.