Stock Market Today: Stocks Notch Win After July CPI Report

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published 10 August 2023

Stocks shot higher out of the gate Thursday as investors cheered the latest inflation data. However, the enthusiasm faded as the session wore on as market participants parsed some concerning jobs data, with the main benchmarks finishing far from where they started.

Data from the Bureau of Labor Statistics showed that the July Consumer Price Index (CPI) was up 0.2% month-over-month and 3.2% year-over-year – the latter a slight uptick over the 3.0% annual increase seen in June. Meanwhile, core CPI, which excludes volatile food and energy prices and is often a better tell on future inflation, rose 0.2% on a monthly basis. Year-over-year, core CPI was up 4.7%, below June's 4.8% increase. Areas that saw the biggest price increases were shelter and food.

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"The Fed has always stressed it would take a long time to tame inflation, and today's data illustrates their point," says Mike Loewengart, head of model portfolio construction at Morgan Stanley. Today's jobless claims "may fuel investor hopes that the tight labor market is loosening up, but we've seen a few head fakes from the weekly numbers in the recent past – we still need to see a clear trend in the monthly numbers," Loewengart notes, adding that the Fed might leave interest rates unchanged next month, but it's unlikely to start cutting them.

"The deal is transformational for TPR and reshapes the landscape of the handbag space, particularly in the U.S.," says Wells Fargo analyst Irwin Boruchow. "The addition of Michael Kors cements TPR as the number one player in the accessible luxury handbag market in the U.S. by a wide margin," the analyst writes. The additions of Versace and Jimmy Choo position Tapestry to compete with European luxury stocks such as Kering (PPRUY) and LVMH Moët Hennessy (LVMUY), Boruchow adds.

As for the major indexes, all three were up more than 1% mid-morning, but erased the bulk of these gains by the close. The Dow Jones Industrial Average outperformed, finishing 0.2% higher at 35,176, as Walt Disney (DIS, +4.9%) jumped after earnings. The entertainment and media giant reported higher-than-expected fiscal third-quarter earnings, but revenue fell short. The company also said it is raising prices on its Disney+ and Hulu streaming services, though cheaper ad-supported versions remain.

With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.