Stock Market Today: Stocks Rise With Inflation Data on Deck

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published 8 September 2023

It was a choppy end to a down week for stocks as investors looked ahead to next week's critical inflation update.

Amid relatively bare economic and earnings calendars, today's price action was driven by single-stock moves, with notable upside in a few mega-cap names helping the Nasdaq Composite avoid a fifth straight loss.

At Friday's close, the Dow Jones Industrial Average was up 0.2% at 34,577, while the S&P 500 was 0.1% higher at 4,457. The Nasdaq, meanwhile, rose 0.1% to 13,761, its first win in five sessions. All three benchmarks closed in negative territory for the week.

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Positive end-of-week returns for several of the biggest Nasdaq stocks buoyed the tech-heavy index. Notably, Apple (AAPL) stock, which has shed about $200 billion in market value this week on news China could widen its ban of iPhones to include state-owned companies and government-backed agencies, gained 0.4%.

Amazon.com (AMZN, +0.3%) and Microsoft (MSFT, +1.3%) – two other stocks with outsized weightings in the Nasdaq – also gained ground today.

RH stock spirals after earnings

Elsewhere, RH (RH) plunged 15.6% after the high-end furniture retailer that was previously known as Restoration Hardware reported earnings. In the second quarter, RH reported higher-than-expected earnings of $3.93 per share on $800 million in revenue.

However, the company forecast third-quarter sales below analysts' estimates amid continuing challenges in the luxury housing market and broader economy. The retail stock was a former member of the Berkshire Hathaway equity portfolio, though Warren Buffett and his team exited the stake in the first quarter of this year.

Market participants also kept an eye on rising oil prices, with U.S. crude futures climbing 0.7% to $87.51 per barrel, bringing their weekly gain to 2.3%. This gave a boost to energy stocks, with Marathon Petroleum (MRO, +2.3%) and Phillips 66 (PSX, +2.9%) among the day's biggest advancers.

Rising oil prices could impact inflation

Energy prices will feature prominently in next Wednesday morning's release of the August Consumer Price Index (CPI) report, says Douglas Porter, chief economist at BMO Capital Markets.

"We reckon that gasoline prices rose roughly 10% in seasonally adjusted terms in the month, which alone will bump up the CPI by four ticks," the economist says. "We look for overall prices to rise a meaty 0.6%, lifting the annual inflation rate to 3.6% (from 3.2%)." The core reading, which excludes volatile food and energy prices, should be "much more friendly," Porter adds.

Meanwhile, there are still a few stragglers left to report earnings, including Photoshop creator Adobe (ADBE). The tech stock has been red-hot this year – building on its impressive 20-year return – on optimism over the company's artificial intelligence (AI) initiatives.

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.