Inflation in the United States showed signs of slowing down in October, with consumer prices rising by 3.2%, lower than the 3.3% expected by analysts. This data significantly impacted global markets, particularly with Wall Street experiencing a surge after the news.
US Inflation: optimism in Global Markets
On a monthly basis, prices remained unchanged, contrary to the expected 0.1% increase. The core index, excluding energy and food, monitored by the Federal Reserve, rose by 4% annually, slightly below the analysts’ predicted 4.1%, and by 0.2% monthly.
The inflation data brought enthusiasm to Wall Street, with the Dow Jones registering a 1.43% increase, continuing the upward trend highlighted by three consecutive gains. The S&P 500 also closed higher at 4,496 points, with the Nasdaq 100 rising by 2.13%.
Positive Reactions in Europe
European markets responded positively, with Milan closing up by 1.4%, London at +0.20%, Paris at +1.38%, and Frankfurt at +1.75%. The spread between Italian Btp and German Bund decreased significantly to 181 basis points.
The US stock market sector saw strong gains, with Home Depot (+5.46%), Walgreens Boots Alliance (+4.56%), Dow (+3.69%), and Goldman Sachs (+3.65%) being major players in the Dow Jones.
Amazon.com (+2.25%) and Tesla (+6.12%) positively contributed to the market’s performance, while financial sector stocks like Goldman Sachs and Jp Morgan Chase gained 3.09% and 1.8%, respectively.
US Inflation: impact on Future Macro Indicators
The reading of inflation data provides further arguments in favor of the end of the Federal Reserve’s interest rate hike cycle, and investors are closely watching upcoming macroeconomic indicators, including retail sales and production prices.
Conclusion: Optimism and Uncertainties
In conclusion, despite US inflation rising to 3.2% in October, the stock market seems to maintain an optimistic attitude, reflecting investors’ confidence in short-term economic stability. The impact of upcoming economic data on Federal Reserve decisions and the global investment landscape remains to be seen.
Focus on Next Developments
Attention now turns to future developments, with retail sales, production prices, and other US macroeconomic indicators closely monitored by market participants. Investors are seeking signals that can confirm or challenge the current optimism, while the Federal Reserve prepares for crucial decisions on future monetary policies.
In a global context, investors are also assessing the impacts of US inflation on international markets. European economies seem to benefit from Wall Street’s positive performance, but uncertainty persists due to various geopolitical factors and global economic challenges.
In conclusion, although US inflation exceeded expectations in October, prevailing optimism in financial markets suggests confidence in the economy’s adaptability. However, there remains a degree of caution as investors closely watch economic developments and monetary authorities’ decisions.