Wall Street ended mixed overnight as inflation concerns and disappointing bank earnings dragged on sentiment. The Dow Jones Industrial Average dropped 436 points, or nearly 1%, to close at 44,023. The broader S&P 500 lost 0.4% to finish at 6,243, easing off an intraday record. The Nasdaq was the lone gainer, rising 0.2% to a record close of 20,678, lifted by strong gains in Nvidia.
Inflation heats up as tariffs bite
June inflation figures released overnight showed headline CPI rose 0.3% for the month, lifting the annual rate to 2.7%—the highest in four months. Core inflation, which strips out food and energy, rose 0.2%, slightly below expectations, but still brought the annual core rate to 2.9%.
While the figures matched consensus, they reinforced concerns that tariffs are starting to feed through to prices. President Trump on the weekend announced a new 30% tariff on EU and Mexican goods, set to take effect August 1.
Bank earnings disappoint despite headline beats
Bank earnings also added to the market’s unease. Wells Fargo beat on profit but slashed its net interest income outlook, sending its shares down more than 5%. JPMorgan also reported strong trading and investment banking numbers, but still edged lower. BlackRock fell nearly 6% on a revenue miss.
The standout was Citigroup, which bucked the trend with a 3% gain after topping second-quarter estimates.
Australian outlook and commodities
SPI200 futures are pointing to a weaker open, down 67 points or 0.8% to 8544, after the inflation print firmed expectations the Fed will hold rates steady for longer. Traders are now pricing just a 54% chance of a rate cut in September, down from nearly 61% a week ago.
The 30-year US bond yield rose to 5.02%, while the 10-year sits at 4.48%. The Australian 10-year yield is 4.38%.
Commodities also retreated. Brent oil fell 0.7% to US$68.71 a barrel. Iron ore eased to US$98.95 a tonne. Gold dropped to US$3,333 an ounce, and Bitcoin fell 2.6% to US$116,889.
Today’s agenda
Locally, quarterly results are due from Rio Tinto, Evolution Mining and Amplitude Energy. Internationally, eyes are on US producer price inflation data due tonight.
