Indexes Drop Ahead of US CPI – US Market Wrap

Stocks fell and bond yields rose, with Wall Street traders awaiting key inflation data for clues on whether the Federal Reserve will cut or hold rates next week.

In the run-up to the consumer price index, the S&P 500 edged lower amid mixed signals from its most-influential group. A gauge of the “Magnificent Seven” megacaps climbed 1%, led by Alphabet as analysts applauded the Google parent’s announcement of a major development in quantum computing through the use of its Willow quantum chip.

Wednesday’s CPI will offer Fed officials a final look at die pricing environment ahead of their next meeting. Any indication that inflation progress has stalled could well undercut the chances of a rate cut. For now, swap trading projects an 80% chance of a quarter-point Fed reduction this month.

The S&P 500 fell 0.3%. The Nasdaq 100 slid 0.3%. The Dow Jones Industrial Average slipped 0.3%. Treasury 10-year yields rose two basis points to 4.22%.