Dow slips amid hotter than expected PPI inflation data
Stocks traded lower at open on Thursday, with the Dow Jones Industrial Average falling nearly 200 points as the market reacted to a hotter-than-expected inflation report.
- Stocks fell as the producer price index came in hotter than expected.
- Dow dropped sharply before showing a slight recovery, while Bitcoin slipped from all-time highs of $124k
The Dow Jones Industrial Average declined nearly 200 points, or about 0.4%, as Wall Street digested the latest producer price index data. The S&P 500 also shed gains, slipping about 0.3% to move off record highs reached in the previous session. Overall sentiment around the PPI inflation print for July also weighed on the Nasdaq Composite, which fell about 0.2%.
As stocks fell amid an injection of negative sentiment, cryptocurrencies pared gains. The volatility was sharp.
The crypto market cap dropped by about 2.6% to hover just above $4 trillion, with Bitcoin (BTC) declining to around $118,500 and Ethereum (ETH) retreated to around $4,600. In comparison to prices prior to PPI data, BTC had reached an all-time high of $124,457 earlier in the day.
Stocks fall on hot PPI
Wall Street’s reaction followed July’s producer price index data, which showed PPI PPI rose 0.9% month-over-month, far above the consensus estimate of 0.2%. The inflation report also showed producer prices climbed 3.3% annually in July, the highest since February 2025. Meanwhile, “core” PPI, which excludes food and energy costs, rose at levels last seen in June 2022.
The S&P 500 and Nasdaq remain near record highs, reached as Wall Street celebrated corporate earnings and cooler-than-expected CPI. However, the latest inflation report on wholesale costs injected jitters into the market, with investors concerned the PPI reading could lead the Federal Reserve to delay a rate cut in September.
Despite the hotter data, fed funds futures still signaled a bullish outlook, with investors pricing the odds of a Fed rate cut in September at 93%, down only slightly from 94% on Wednesday. Traders monitoring other market factors helped the Dow recover part of its losses, though it was still down 98 points at the time of writing.
