Morning in New York: equaling inflation

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The focus of the upcoming trades will be the publication of manufacturing inflation (PPI) data for August (consensus for core and total: +0.3% m/m, July: +0.9% m/m for both). For the market, this release should be a confirmation or refutation of the stability of the trend in services after the July jump, as well as an indicator of the pressure of import duties on import-dependent product categories. The baseline scenario assumes a moderate slowdown in price growth. The risky forecasts include the resumption of their growth in such categories of goods as clothing, household goods, cars. On Thursday, September 11, the Consumer Price Index (CPI) data will also be released. If both inflation indicators come in above consensus, expectations for easing of the MPC will be adjusted. At the same time, the cooling of the labor market over the past two months remains a strong argument for a change in monetary conditions. We believe that a 25bp cut in the Fed Funds rate in September is most likely.

The judicial blocking of the White House's attempt to remove Fed Board of Governors member Lisa Cook from her position supports the independence of the regulator, which becomes especially important ahead of the FOMC meeting on September 16-17. At the same time, the White House's foreign trade agenda reinforces pro-inflation risks. Under the current trade truce with China, the US holds a 30% tariff on a wide range of Chinese goods. The possibility of the European Union raising duties on U.S. imports to 100% and Washington's readiness for a symmetrical response is being discussed. Together with the 50% duties imposed on India, all this means tougher price conditions for import-dependent categories of goods.

Chewy (CHWY), Daktronics (DAKT) and National Beverage (FIZZ) will report quarterly results before the main session opens.

Futures on US indices are trading in a slight plus on the back of a positive report from Oracle (ORCL), which supported a wide range of AI-related companies, from chipmakers to power supply to data centers. We assess the balance of risks for the upcoming session as neutral with an average level of volatility. We focus on S&P 500 movements in the range of 6460-6565 points (from -0.8% to +0.8% of the previous session's closing level).

- Oracle (ORCL) plans to increase its OCI cloud services revenue from the current $20 billion to $144 billion by fiscal 2030. Management noted RPO approaching the $455 billion mark. The company has signed several multi-billion dollar contracts. Capex for 2026 is slated to be in the range of $35 billion. ORCL shares are up nearly 30% in the premarket on this news.

- Synopsys (SNPS) reported a weaker-than-expected quarter, its outlook was more cautious, adding to near-term earnings concerns. The company's shares reacted to the release with a drop of about 20% and remain under pressure ahead of the opening of major trading on September 10.

- GameStop 's (GME) quarterly revenue and earnings beat consensus. Gadgets and collectibles divisions showed the strongest results. The issuer's cash position has strengthened. Its shares are moving upward on the premarket.

September 9 trading on the U.S. stock exchanges ended mixed. The S&P 500 added 0.27%, the Nasdaq 100 rose 0.33%, the Dow Jones rose 0.43%, and the Russell 2000 declined 0.55%. Utility providers (XLU: +0.69%) led the gains. Materials producers (XLB: -1.63%) were the outsiders. In the "Magnificent Seven" the best result was demonstrated by Alphabet (GOOGL: +2.39%), and Apple (AAPL: -1.48%) went into a noticeable minus after the presentation of new products.

BLS revised employment data showed that the decline in new jobs from April 2024 to March 2025 was 911 thousand more than previously reported, while a revised value of 800 thousand was expected. The reduction in job supply affected trade, transportation, utilities, leisure and hospitality, professional services and manufacturing. Market participants took this statistic as an additional confirmation of the weakening labor market and another argument in favor of more active reduction of the Fed's rate.

The NFIB Small Business Optimism Index rose to 100.8 from a consensus of 100.5 (July: 100.3), helped by a widening share of entrepreneurs expecting real sales to rise. That said, labor quality remained a key concern. Uncertainty is declining but remains above average.

- UnitedHealth Group (UNH: +8.6%) reported that about 78% of its customers will be in "4-star or higher" level plans by 2027. Strengthening positions in the Medicare Advantage market supported the issuer's quotations.

- Atlassian (TEAM: +5.6%) announced that it will no longer support data center products, prioritizing cloud solutions. Management noted that 99% of its more than 300,000 customers already use cloud services, which the market perceived positively.

- Phillips 66 (PSX: +1.6%) has confirmed the purchase of the remaining 50% of WRB Refining from Cenovus Energy. The company expects synergies of about $50 mln per annum and improved refining margins.

- Quotes of PACS Group (PACS: -28.8%) collapsed after the resignation of CFO at the request of the Board of Directors: the audit committee found irregularities in the acceptance of gifts. A top manager, who held this position earlier, was appointed as interim CFO, which increased uncertainty regarding corporate control.

- Core & Main (CNM: -25.4%) reported revenue and EBITDA worse than expected, and lowered its outlook for the year due to unfavorable housing and rising costs.

- Quotes of Albemarle (ALB: -11.5%) fell amid news about the reopening of the lithium mine in Yichun (China), as it creates risks of increased supply, which will put pressure on the price of metal.

- Fox (FOX: -6.7%) declined along with News (NWSA: -1.74%) amid the completion of a deal to transfer control to the Murdoch family. Lachlan Murdoch gained full control, while the stakes of the other owners were bought out through a $3.3 billion Class B share offering.

- Dell Technologies (DELL: -1.4%) reported a change of CFO, which, as emphasized, is not related to disagreements in the management. However, market participants took this news cautiously because of the proximity to the upcoming investor day in October.

This article was AI-translated and verified by a human editor