In this year’s fast-paced financial markets, research reigns supreme for investors seeking to navigate the tides of market fluctuations. Whether you’re trading penny stocks or large-cap equities, understanding the intricacies of the stock market is important.
This week, our attention is focused on a factor that wields considerable influence over market trends: inflation data. Today we spotlight the much-anticipated release of the May Consumer Price Index (CPI) data.
The May CPI report could give more clues as to the state of the consumer and what the Federal Reserve may decide on next as far as rate hikes. This week is a one-two punch of economic data and Fed commentary. The FOMC meeting for June wraps up on Wednesday, along with the associated press conference to follow.
What Is CPI Inflation Data?
But what exactly is the CPI? In essence, it is a comprehensive measure of the average price level of goods and services commonly consumed by households. By tracking changes in the prices of these items over time, CPI can give insight into the trajectory of inflation. It also allows economists and investors to gauge the purchasing power of consumers, and make informed decisions.
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The U.S. Bureau of Labor Statistics explains it as“The CPIs are based on prices of food, clothing, shelter, fuels, transportation, doctors’ and dentists’ services, drugs, and other goods and services that people buy for day-to-day living. Prices are collected each month in 75 urban areas across the country from about 6,000 housing units and approximately 22,000 retail establishments (department stores, supermarkets, hospitals, filling stations, and other types of stores and service establishments).”
Fluctuations in the CPI serve as revealing indicators of underlying economic forces. These include the supply and demand dynamics, alterations in production costs, and shifts in consumer behavior. A surge in inflationary pressures, for instance, may suggest heightened consumer demand for goods and services. That could potentially spell good news for businesses and investors. Conversely, it could signal escalating production costs, potentially leading to higher price tags for consumers and chipping away at their purchasing prowess.
Against the backdrop of 2023, a year brimming with its own distinctive challenges and opportunities, the relationship between the CPI data and stock market performance assumes even greater significance. Will inflationary pressures persist, potentially triggering a further uptick in interest rates? Or can the data unveil a more controlled and manageable inflationary landscape? These are the questions that market participants need to answer, as they maneuver through the daily volatility trends.
What Time Is CPI Released Today?
CPI Data and the April Consumer Price Index report is released at 8:30 am ET today, June 13th.
Consumer Price Index Report For April 2023 & CPI Numbers
The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in April on a seasonally adjusted basis, after increasing 0.1 percent in March, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 4.9 percent before seasonal adjustment.
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The index for shelter was the largest contributor to the monthly all-items increase, followed by increases in the index for used cars and trucks and the index for gasoline. The increase in the gasoline index more than offset declines in other energy component indexes, and the energy index rose 0.6 percent in April. The food index was unchanged in April, as it was in March. The index for food at home fell 0.2 percent over the month, while the index for food away from home rose 0.4 percent.
The index for all items less food and energy rose 0.4 percent in April, as it did in March. Indexes that increased in April include shelter, used cars and trucks, motor vehicle insurance, recreation, household furnishings, and operations, and personal care. The index for airline fares and the index for new vehicles were among those that decreased over the month.
The all-items index increased 4.9 percent for the 12 months ending April; this was the smallest 12-month increase since the period ending April 2021. The all items less food and energy index rose 5.5 percent over the last 12 months. The energy index decreased 5.1 percent for the 12 months ending April, and the food index increased 7.7 percent over the last year.
CPI Report Today: May Inflation Expectations
- Headline CPI MoM: 0.2%
- Headline CPI YoY: 4.1%
- Core CPI MoM: 0.4%
- Core CPI YoY: 5.3%
Consumer Price Index Report For May 2023 & CPI Numbers
- CORE CPI YoY: 5.3% IN LINE
- CORE CPI MoM: 0.4%IN LINE
- Headline CPI YoY: 0.1% BELOW EXPECTATIONS
- Headline CPI YoY: 4.0% BELOW EXPECTATIONS
The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.1 percent in May on a seasonally adjusted basis, after increasing 0.4 percent in April, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 4.0 percent before seasonal adjustment.
The index for shelter was the largest contributor to the monthly all items increase, followed by an increase in the index for used cars and trucks. The food index increased 0.2 percent in May after being unchanged in the previous 2 months. The index for food at home rose 0.1 percent over the month while the index for food away from home rose 0.5 percent. The energy index, in contrast, declined 3.6 percent in May as the major energy component indexes fell.
The index for all items less food and energy rose 0.4 percent in May, as it did in April and March. Indexes which increased in May include shelter, used cars and trucks, motor vehicle insurance, apparel, and personal care. The index for household furnishings and operations and the index for airline fares were among those that decreased over the month.
The all items index increased 4.0 percent for the 12 months ending May; this was the smallest 12-month increase since the period ending March 2021. The all items less food and energy index rose 5.3 percent over the last 12 months. The energy index decreased 11.7 percent for the 12 months ending May, and the food index increased 6.7 percent over the last year.
Stock Market Today
Things were relatively muted in the stock market today shortly after the May CPI inflation report was published. The S&P 500 (SPY) churned around premarket highs as well as the Nasdaq (QQQ). The market has priced in a paused rate hike scenario as a result.
What’s going on with other companies in the stock market today? Shares of Tesla (TSLA), however, shot higher as the company was granted a US patent for “autonomous driving systems emergency signaling.” Meanwhile, shares of small-cap stocks traded slightly higher. The Russell 2000 ETF (IWM) sparked to highs of $187 before settling back around $186.30. This struck a chord with traders looking for penny stocks to buy. One of the most active penny stocks today was First Wave Biopharma Inc. (FWBI).
The company announced that it reached its enrollment target for its Phase 2 SPAN Adrulipase trial in cystic fibrosis. James Sapirstein, Chief Executive Officer of First Wave BioPharma commented, “We are very pleased to have reached the enrollment target in our Phase 2b SPAN study of adrulipase. The majority of patients in the study have completed dosing and the remaining patients are currently being dosed. We remain on track to report topline data in July 2023.”
