CPI data creates problems for Wall Street

Stocks on Wall Street drifted between gains and losses on Wednesday, with the S&P 500 down 0.2% soon after the start of trading. The Nasdaq composite ticked up 0.3%. After opening higher, the Dow and S&P 500 soon lost momentum and gave back their modest gains in exchange for losses. Dow was 0.3%, or 108 points, lower, while the S&P 500 kept flat.

American Express and JPMorgan, the latter of which reported earnings before the bell, were the weakest performers in the Dow.

Consumer Price Index data from the Labor Department showed that prices continued their ascent in September. Social Security benefits will rise 5.9% in 2022, the highest in four decades.

Wages are already heading up, though typically too little to fully offset the amount of inflation that has occurred this year. There are notable exceptions to that, including in leisure and hospitality jobs, where pay has accelerated faster than prices.

The Fed aims for 2 percent inflation on average over time, which it defines using a different but related index, the Personal Consumption Expenditures measure. That gauge is released at more of a delay, and has also jumped this year.

Wall Street is watching every fresh inflation data print closely, because higher rates from the Fed could impact growth and stock prices. Climbing costs can cut into corporate profits, denting earning prospects.

The White House is under pressure to come up with whatever fixes it can. Later on Wednesday, President Biden is expected to address the supply-chain problems — which are weighing on his approval ratings as they push prices higher.