Morning Minutes

Mixed US Inflation Report Sparks Market Volatility




Inflation reports are top of mind with US investors this morning. Headline US Consumer Prices (6.4% vs street 6.2% and previous 6.5%) and Core CPI (5.6% vs street 5.5% and previous 5.7%) continued to trend downward but not as quickly as investors had hoped. Overseas, UK average hourly earnings growth eased back (5.9% vs street 6.2% and previous 6.5%), and inflation expectations in New Zealand declined (3.3% vs previous 3.6%).

US index futures spent the runup to the inflation report moderately in the green with gains of 0.2% to 0.4% but have been volatile since then, with bulls and bears fighting over implications of the mixed CPI data. Having dropped back to breakeven at one point, US index futures are currently up about 0.1%. European markets have been on the rise today with the Dax and FTSE both up about 0.4%. WTI Crude Oil is down 1.4% after President Biden ordered a release of 26 mmbbls from the US Strategic Petroleum Reserve. Natural Gas, meanwhile, is up 5.2%.

In earnings news today, Restaurant Brands, parent company of Tim Hortons, Burger King and Popeyes beat expectations on sales ($1.69B vs street $1.67B), but missed on earnings, while Coca-Cola beat on sales ($10.13B vs street $10.02B). After the close today, results are due from Suncor Energy and AirBNB.

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Colin Cieszynski, Chief Market Strategist

Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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