Dow Jumps After Inflation Report

Stocks were little changed after the new data showed the inflation rate fell to its lowest level in more than three years in June, bolstering the case for the Federal Reserve to cut rates later this year.

The Dow Jones Industrials captured another 152.98 points to open Thursday at 39,874.34.

The S&P 500 index lopped off 4.3 points to 5,629.61, threatening its seven-session win streak.

The NASDAQ dropped 98.34 points to 18,549.11, from Wednesday’s all-time high.

The consumer price index fell 0.1% last month from May, bringing the annual inflation rate down to 3%. Economists surveyed by Dow Jones had expected a 0.1% monthly increase and a 3.1% annual rate. Core CPI, which excludes food and energy, came in at a 3.3% annual rate, also lower than economists expected.

Odds of a September rate cut rose to greater than 80% based on fed funds futures trading following the CPI data. Traders still see the Fed standing pat at its meeting later this month.

Nvidia led chip stocks higher in the premarket as investors jumped back into bull market winners following the better-than-expected inflation reading. Housing-related shares such as Home Depot and D.R. Horton jumped on the hope lower rates would reignite a stalling housing market.

Prices for the 10-year Treasury jumped, lowering yields to 4.17% from Wednesday’s 4.28%. Treasury prices and yields move in opposite directions.

Oil prices retreated 29 cents at $81.81 U.S. a barrel.

Gold prices spiked $33.90 to $2,413.60

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