Stock Market Update

[BRIEFING.COM] The major equity indices trade near their lowest levels of the session. The S&P 500 (-1.3%) trades more than 10% below its all-time high, marking a move into correction territory. The Nasdaq Composite trades about 1.8% lower and the Dow Jones Industrial Average is 1.2% lower than yesterday. 

The downside bias continues despite some pleasing inflation data in the form of the February Producer Price Index, which contained some lower-than-expected headline prints.

The positive news on the inflation front has been overshadowed by ongoing worries about tariffs, which may negatively impact inflation in future prints. President Trump recently threatened a 200% tariff on EU wines and champagne in response to the whiskey dispute.

Relatively disappointing in-line guidance from Adobe (ADBE 381.11, -57.49, -13.1%) and disappointing guidance from SentinelOne (S 18.66, -0.63, -3.3%) and UiPath (PATH 10.15, -1.68, -14.2%) has weighed on growth stocks, contributing to the overall downside bias.

All 11 S&P 500 sectors show declines led by consumer discretionary (-2.8%), communication services (-2.5%), and technology (-1.6%). The Invesco S&P 500 Equal Weight ETF (RSP) trades 0.6% lower.

Treasuries had a muted response to this morning's data. The 2-yr yield is down three basis points to 3.96% and the 10-yr yield is down two basis points to 4.30%.

Reviewing today's economic data:

• February PPI 0.0% (Briefing.com consensus 0.3%); Prior was revised to 0.6% from 0.4%, February Core PPI -0.1% (Briefing.com consensus 0.3%); Prior was revised to 0.5% from 0.3%
  • The key takeaway from the report is comparable to the key takeaway from the CPI report: inflation at the wholesale level, while improving, is still too high, and with the tariff battles heating up, there is concern that the disinflation isn't going to persist.
• Weekly Initial Claims 220K (Briefing.com consensus 228K); Prior was revised to 222K from 221K, Weekly Continuing Claims 1.870 mln; Prior 1.897 mln
  • The key takeaway from the report is that initial jobless claims -- a leading indicator -- held steady at relatively low levels that are consistent with an otherwise sound labor market.