U.S. equities gained this week, largely driven by bets that the Fed would lower rates at its next meeting in September. The Russell 2000 Index outperformed the S&P 500 Index by the widest weekly margin since April. July CPI US inflation data - published on Wednesday - showed that headline inflation cooled modestly in July, with MoM inflation dropping to 0.2% from June’s reading of 0.3%. However, core inflation accelerated to 0.3% from 0.2% in the prior month. Year-over-year jumped to 3.1%, the highest since February. Later in the week, however, the BLS reported that its producer price index (PPI) reaccelerated in July, rising 0.9% compared with estimates for around a 0.2% increase. Similar to consumer prices, services costs drove the overall increase. The report sent stocks lower at the open on Thursday, although most indexes ultimately recovered and finished the day little changed. The probability of a September rate cut also declined following the report. Meanwhile, retail sales climbed while consumer sentiment deteriorated on inflation concerns. Treasury yield curve steepens on July PPI data. The dollar ended the week modestly lower. Gold tumbled, recording its worst week since June. Oil was down for the second week in a row, closing near 3-month lows. Bitcoin ended the week very marginally lower, having plunged after surging up to record highs mid-week. The STOXX Europe 600 Index ended 1.2% higher on easing trade tensions and hopes of progress on ending the Russia-Ukraine conflict.
Have a great week-end