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News That Moved the Market
Better Than Expected Inflation Spurs Bulls. April's CPI report ignited a buying spree early in the session. The consumer price index rose 0.2%, better than the 0.3% reading expected by economists. Core-CPI, which excludes energy and food, increased by 0.1%, less that the 0.2% jump expected. In the last year, CPI has increased 3.9%, while core-CPI is up 2.3%. The tame reading is an indication the Fed will not have to fight inflation by increasing interest rates in upcoming meetings. Freddie Mac (FRE, +9.2%) also was a source of positive news this morning, posting a smaller loss than expected. The company announced a loss of $0.66/share, easily beating analysts' average estimates of $0.93/share. Late in the afternoon, a massive amount of selling pushed major indices lower, erasing most of the gains from earlier in the day.
Quick Tics: There were some analysts who were suspicious of the CPI data like Peter Cardillio, chief market strategist at Avalon Partners, who said, "I'm not going to say it's a bogus number, but if you look at the yield spread between the 10-year Treasury bond and the Treasury Inflation-Protection Security, or TIP, its 2.47%, an indication of inflation"…Macy's (M, +3.6%) announced it swung to a loss in the first quarter, but investors liked that the company beat sales estimates and backed its full-year outlook…Crude ended at $125.55/barrel, down a quarter.
Notable Earnings (Full List Here):
JC Penney (NYSE:JCP) Before Open
Urban Outfitters (NASDAQ:URBN) Before Open
Kohl's (NYSE:KSS) After Close
Nordstrom (NYSE:JWN) After Close
8:30 AM: Jobless Claims
8:30 AM: Empire State Mfg Survey
9:15 AM: Industrial Production
9:30 AM: Federal Reserve Chairman Ben Bernanke Speaks
10:00 AM: Philadelphia Fed