Dow Jones climbs following PPI data

Dow Jones rose 300 points on Tuesday after US Producer Price Index inflation eased more than expected in July. This gave stocks a chance to breathe and sent the DJIA into 39,700.00. US PPI inflation eased to 2.2% YoY in July, falling below the expected 2.3% and further from the previous period’s revised 2.7%. Core PPI inflation also declined to 2.4% for the year ended in July, dropping below the forecast 2.7% and well below the previous 3.0%.

Continued declines in US inflation pressure bolstered risk appetite in the US market session, with market bets of a 50 basis point double-cut in September from the Federal Reserve (Fed) rising to 55%. The week’s key data print is US Consumer Price Index inflation, forecast to tick down to 3.2% YoY from 3.3%.

Markets have fully priced in at least a quarter-point cut from the Fed on September 18, and continued easing in inflation metrics will likely spark a further dogpile into bets of a double cut.

All but five of the Dow Jones’ constituent securities were in the green on Tuesday, with Walmart Inc. falling -1.25% to $67.80 per share ahead of its latest earnings report slated for August 15.

Nike Inc. rallied 5.6% to $78.83 per share as investors see a rebound in its share price on “brand momentum” following a shuffle of downstream production chains and new franchise shoe releases garnering significant search interest.