Inflation continued to soar but in line with expectations, US stocks opened higher and the Dow rose 100 points | Anue Juheng

The U.S. inflation rate climbed to 7% last month, continuing to hit a 39-year high, but it was roughly in line with market expectations. Therefore, the major indexes did not experience a drastic shock. All U.S. stocks opened higher on Wednesday (12th). At the time of writing, the Dow Jones Industrial Average was up 140 points, or 0.4%, the Nasdaq Composite was up 0.5%, the S&P 500 was up 0.3% and the Philadelphia Semiconductor Index was up 1.3%.

The annual growth rate of the US CPI in December reached 7%, in line with market expectations and the highest record in nearly 40 years. The monthly growth rate was reported at 0.5%, slightly higher than the market expectation of 0.4%. The core CPI, which excludes food and energy prices, rose 5.5% from a year earlier, hitting a 30-year high.

The 10-year U.S. Treasury yield rose modestly following the data, slipping to 1.720% by the time of writing.DollarThe index fell 0.3%.

Federal Reserve Chairman Jeremy Powell assured a Senate hearing yesterday that he would step in to control rising prices if necessary, and reiterated that the central bank would use policy tools to cool inflation and ensure that inflation would not become entrenched.

Powell’s comments yesterday were less hawkish than the market had envisioned, boosting technology stocks and leading a rebound in major indexes. Big tech stocks edged higher following the opening bell on Wednesday, with Amazon (AMZN-US) rose 0.2%, Apple (AAPL-US) rose 0.6 percent, Microsoft (MSFT-US) and Alphabet (GOOGL-US) rose more than 1%.

Stock news, Ocugen (OCGN-US) rose 9% at the opening, and the latest test showed that the vaccine booster Covaxin jointly developed with its partner Bharat Biotech can effectively neutralize the Omicron and Delta variant viruses.

As of 22:00 on Wednesday (12th) Taipei time:

• The Dow Jones Industrial Average rose 145.73 points, or 0.40%, to 36,397.75
• The Nasdaq Composite rose 80.69 points, or 0.53%, to 15,233.70
• The S&P 500 rose 14.54 points, or 0.31%, to settle at 4,728.68
• Feihan rose 48.70 points or 1.26%, temporarily reported 3924.14 points
• TSMC ADR rose 1.61% to 131.25 per share Dollar
• 10-year U.S. Treasury yield slips to 1.720%
• NY Light crude rose 1.02% to 82.05 a barrel Dollar
• Brent crude rose 0.55% to 84.18 a barrel Dollar
• Gold rose 0.11% to 1820.50 an ounce Dollar
• DollarIndex fell to 95.32

The daily chart of the Dow Jones Industrial Average (Figure: Juheng.com)

Stocks in focus:

ByDash(DASH-US) rose 3.92% to 149.27 in early trade Dollar。

Evercore ISI added DoorDash to its strategic action and positioning leader list, citing its low valuation and strong fundamentals, and upgraded the stock to “outperform” with a price target of 256 Dollar, a 78% premium to Tuesday’s closing price.

Didi (DIDI-US) rose 5.10% to 5.15 in early trade Dollar。

According to reports, Didi is in discussions with the Hong Kong Stock Exchange for an IPO in Hong Kong. According to sources, the listing time point may fall in the second quarter, and the financial terms of the listing are still being drafted.

Philips (PHG-US) fell 14.68% to 33.08 in early trade Dollar。

Philips warns that supply chain bottlenecks and respirator product recalls may affect Q4 profits, with adjusted EBITDA expected to reach 650 million in Q4 last yearEUR, an annual decrease of 43%, the annual sales are estimated to be 17.2 billionEUR, an annual decrease of 12%.

Today’s key economic data:

• US December CPI annual rate of 7%, expected 7%, the previous value of 6.8%
• The monthly rate of the US CPI in December was 0.5%, expected 0.4%, the previous value was 0.8%
• The U.S. core CPI in December reported an annual rate of 5.5%, expected 5.4%, and the previous value of 4.9%
• The US core CPI in December reported a monthly rate of 0.6%, expected 0.5%, and the previous value of 0.5%

Green: US CPI monthly rate, Blue: US CPI annual rate (Graph: Zerohedge)

• At 23:30 Taipei time, the weekly EIA crude oil inventory changes in the United States were announced, the previous value was – 2.144 million barrels

Wall Street Analysis:

For now, a repricing of the hawkish Fed is likely to be complete, and resilient corporate earnings should help stocks rally, according to a team of strategists at Barclays Plc, led by Emmanuel Cau.

Luca Paolini, chief strategist at Pictet Asset Management, said that inflation is disturbingly high, which might have a negative impact on growth stocks. As earnings season rolls around, he’s watching to see if high inflation is taking a toll on corporate earnings.

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