S&P hits record high as inflation cools off 🧊

Good Afternoon! 

Hey, everyone. It's Adam from Elite Trade Club. 

Here’s what moved the market today.

Markets 📈

The S&P 500 surged to a record high after April’s CPI data showed inflation had cooled compared to the previous month. The Nasdaq led, with the Dow underperforming.

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Market-Moving News 🔎 

🧊 April CPI Report Soothes Inflation Fears

April's Consumer Price Index (CPI) reveals a slight easing of inflationary pressures, offering some respite to consumers. While the monthly increase of 0.3% aligns closely with expectations, the annual CPI rise stands at 3.4%, signaling continued inflationary challenges.

Core Inflation Trends ⏳
Excluding food and energy, core inflation registers a 0.3% monthly increase and a 3.6% annual rise, consistent with forecasts. Notably, the core 12-month inflation reading marks the lowest since April 2021, reflecting a modest deceleration in price growth.

Market Response and Outlook 📈
Following the CPI release, market sentiment improves, with futures tied to major stock indexes rallying and Treasury yields declining. There's an uptick in the implied probability of the Federal Reserve initiating interest rate cuts by September, signaling investor optimism amidst inflation moderation.

Economic Indicators Analysis 📉
In parallel, retail sales remain stagnant, falling short of estimates for a 0.4% increase. Despite adjusted figures for seasonality, the data suggests consumer spending struggles to keep pace with rising prices, underscoring persistent inflationary pressures.

Drivers of Price Increases 🛒
Notable contributors to monthly price gains include shelter and energy sectors. Shelter costs, a focal point for Fed officials, rise 0.4% monthly and 5.5% annually, highlighting ongoing challenges in inflation management. Energy prices surge 1.1% monthly and 2.6% annually, further impacting overall inflation levels.

Sectoral Trends and Concerns 🏠
Certain sectors witness significant monthly increases, such as apparel (1.2%), transportation services (0.9%), and medical care services (0.4%). Of particular concern is the transportation services sector, with an annual increase reaching 11.2%, posing challenges for policymakers.

Impact on Earnings and Housing 📉
The inflationary uptick translates into diminished real earnings for workers, with a 0.2% monthly decline. Additionally, both rent of primary residence and owners' equivalent rent see 0.4% monthly increases, contributing to a 12-month rise of 5.4% and 5.8%, respectively, emphasizing housing cost challenges.

Aerwins Tech [AWIN] $6.28 (+131%)
rallied despite no company-specific news. The stock’s 18.47% short rate as of April 30th seems to indicate a short squeeze.

Reborn [REBN] $3.75 (+48.2%)
rallied back after a steep sell-off on Tuesday.

T2 Biosystems [TTOO] $5.97 (+43.5%)
announced a preferred-to-common stock conversion by entities affiliated with CRG Servicing.

Yield10 [YTEN] $2.88 (45.2%)
reported weaker than expected earnings & revenues in its Q1 2024 quarterly financial results.

Pixelworks [NOTV] $1.21 (35.2%)
posted weaker-than-expected Q2 guidance on its Q1 earnings report.

Microcloud Holo [HOLO] $2.18 (32.5%)
pulled back after a “Meme Stock”-style short squeeze rally on Tuesday.

That's it for today! Please, write us back, and let us know what you think of the Closing Bell Roundup. We're always eager to hear feedback from our members!

Thanks for reading. I'll see you at the next open! 

Best Regards,
— Adam G.
Elite Trade Club

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