Stocks, Bonds Fall as CPI Boosts Fed-Hike Wagers: Markets Wrap
- Consumer price increase bolsters higher-for-longer Fed stance
- Market-implied odds of another Fed hike rebound to 40%
Source: Bloomberg
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Stocks fell and Treasury yields rose as data bolstered speculation the Federal Reserve is nowhere near declaring victory over inflation — with bets on another hike this year climbing.
The S&P 500 halted a four-day advance. Bank shares underperformed ahead of results from JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. Friday. Bonds dropped across US the curve, with the 30-year rate surging as much as 19 basis points after an auction of the securities drew weak demand. The dollar gained the most in five weeks. Swap contracts pushed the odds of another quarter-point Fed hike to about 40% — from closer to 30% Wednesday.