Markets Rocked as Crude Oil Knocks on $100: Stock Market Today
Escalating war and higher energy prices continue to occupy market participants with less than a week to go before the next Fed meeting.
A global benchmark for crude oil topped $100 per barrel for the first time since late July, Treasury yields rose to new highs and the main equity indexes declined for a third straight trading session on Wednesday. Amid little sign of peace in the Middle East anytime soon, markets are bracing for incoming inflation data a week before the Federal Reserve's next monetary policy meeting.
At the closing bell, the blue-chip Dow Jones Industrial Average was down 0.7% at 52,380, the broad-based S&P 500 had fallen 0.5% to 7,636, and the tech-heavy Nasdaq Composite was lower by 0.6% at 26,253.
The front-month West Texas Intermediate crude oil futures contract was up 3.9% to $96.65 per barrel. The front-month Brent Crude oil futures contract was up 3.6% to $101.45. The global benchmark last closed above the psychologically significant $100 level on July 23.
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Both the 2-year Treasury yield (+2.9 bps, 4.427%) and the 10-year Treasury yield (+3.7 bps, 4.841%) reached fresh 52-week highs, while the 30-year Treasury yield rose 2.8 basis points to 5.292%.
For investors, traders and speculators, it could be as simple as cooler-than-expected incoming inflation data easing some upward pressure on interest rates and giving the world's most important central bank room to hold the target range for the federal funds rate at 3.50% to 3.75% next week.
Indeed, it could be that simple for a Fed chair still looking for the right way to communicate with markets, even after he doubled down on his primary commitment to price stability in his recent keynote speech at Jackson Hole.
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With the economic calendar in tight focus, the Bureau of Labor Statistics (BLS) will release August Producer Price Index (PPI) data before tomorrow's opening bell. The main event, the August Consumer Price Index (CPI) report, lands before the opening bell on Friday.
"A hot CPI print would all but seal a September hike and underpin a firmer dollar," Brown Brothers Harriman & Co. strategist Elias Haddad says. "A cooler reading would strengthen the case for a hold and leave the dollar vulnerable to a dovish Fed repricing."
Why CASY was down 14%
Casey's General Store (CASY, -14.2%), added to the index in April, was the worst-performing S&P 500 stock on Wednesday, even though the company beat Wall Street's fiscal 2027 first-quarter expectations and reiterated full-year guidance.
From its headquarters in Iowa, Casey's operates more than 2,900 locations in 19 states in the Midwest and the South. It's the third-largest convenience store retailer and the fifth-largest pizza chain in the U.S.
"We believe the reaction is overblown and driven largely by short-term trading dynamics on broader rotations outside of the consumer space," William Blair analysts Phillip Blee and Olivia Witte write. "We believe the drop provides a compelling entry point, especially for long-term-oriented investors, as the fundamental strengths of the model and its ability to compound earnings growth over the next decade remain intact."
Blee and Witte reiterated their Outperform (Buy) rating and their $660 12-month target price for the consumer staples stock. Their target suggests upside of about 5% from CASY's closing price on Wednesday.
UBS analyst Mark Carden reiterated his Neutral (Hold) rating, as well as his $925 12-month target price. That's more than 47% from here for CASY.
"We think CASY's 1Q results showed that it executed effectively against an uneven macro, but it may not have been enough amid investor expectations," Carden observes. The analyst cites 3.2% same-store sales growth vs a Wall Street forecast of 3.8% as a potential factor in today's price action.
Carden also notes that the first-quarter figure represents 30 basis points of acceleration compared to the fourth quarter.
Apple doesn't move much
Apple (AAPL, -0.3%) was neither the best nor the worst of the 30 Dow Jones stocks on Wednesday. It was up and down, and it finished only slightly lower.
One of the 10 best tech stocks of all time hit its intraday low soon after new CEO John Ternus took the stage to deliver brief opening remarks and introduce new versions of its leading device. It peaked into positive territory, then danced around the breakeven line into the closing bell.
"We're going to continue changing the world in ways we can't even imagine today," Ternus said before turning to his vision of the iPhone's place in a world increasingly defined by proliferating artificial intelligence (AI).
"If you were designing the ideal version of this hub from scratch, how would you do it?" Ternus posed rhetorically. "Well, first, you would want something that is always with you, deeply personal and able to bring intelligence to the moments when it matters most."
Then Ternus introduced the new iPhone 18 Pro and iPhone 18 Pro Max, as well as the foldable iPhone Duo, meeting market expectations.
"We made massive advancements in the most important areas: intelligence, performance, battery and camera," the CEO said.
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