Wall Street drops after latest inflation data

by Jonathan Adams
Wall Street rally

While the Nasdaq gained marginally, both the Dow and S&P 500 declined

Wall Street stocks mostly dropped Monday after latest inflation data raised questions about US monetary policy, while gold prices rose to a new record.

The Institute for Supply Management’s (ISM) March survey is the first to show US manufacturing activity increasing since September 2022. But markets fixated on a 3.3 percent increase in the ISM’s prices index as compared with February.

The market turned around when ISM came up this morning, according to Jack Ablin of Cresset Capital. This is one sign that could show that the inflation is picking up more.

While the Nasdaq gained marginally, both the Dow and S&P 500 declined.

Markets have been scrutinizing inflation data to gauge the probability of a shift in monetary policy.

The Federal Reserve has said it expects three interest rate cuts in 2024, but that plan could slide if inflation remains higher.

US Treasury yields climbed after Monday’s ISM data.

In Asian trade, Seoul, Singapore and Manila gained, while there were losses in Taipei and Jakarta.

Hong Kong, Sydney, Wellington, London, Paris and Frankfurt were shut for Easter Monday.

Gold reached a record high of $2,265.73, as per Bloomberg News, extending the year’s rally fuelled by central bank hints at an easing of credit conditions.

It is also being supported by its appeal as a safe haven in times of economic uncertainty, with geopolitical tensions growing.

Shanghai climbed nearly 1 percent as traders welcomed news that China’s manufacturing grew for the first time in half a year, giving a boost to leaders as they battle to kickstart the struggling economy.

The 50.8 reading in March was the first showing expansion since September and was well above forecasts.

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of Trading and Investment News. The information provided on Trading and Investment News is intended for informational purposes only. Trading and Investment News is not liable for any financial losses incurred. Conduct your own research by contacting financial experts before making any investment decisions.

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