US Stocks Soar in Response to Inflation Data: Impact on Bitcoin (BTC) and Ethereum (ETH) Explored

• US stocks experienced a surge on Wednesday, following a slight ease in consumer inflation last month.
• The annual Consumer Price Index (CPI) was reported at 3.4 per cent in April, a decrease of 0.1 percentage point from March, according to the Labor Department.
• This inflation data has sparked hopes for potential interest rate cuts from the US Federal Reserve later this year.

US stocks see an upswing as consumer inflation eases, sparking hopes for potential interest rate cuts from the US Federal Reserve.

US Stocks Surge Amid Eased Inflation

On Wednesday, US stocks experienced a significant surge, following a slight decrease in consumer inflation last month. The annual Consumer Price Index (CPI) was reported at 3.4 per cent in April, a decrease of 0.1 percentage point from March, according to a statement from the Labor Department. This inflation data has sparked hopes for potential interest rate cuts from the US Federal Reserve later this year.

Flat Retail Sales and Market Response

In other economic news, US retail sales remained flat in April. This unchanged reading followed a slightly downwardly revised 0.6 per cent increase in March, as reported by the Commerce Department’s Census Bureau. Despite this, the Dow Jones Industrial Average rose 210.56 points, or 0.53 per cent, to 39,768.67, the S&P 500 gained 30.39 points, or 0.58 per cent, to 5,276.98 and the Nasdaq Composite gained 96.94 points, or 0.59 per cent, to 16,608.12. The 10-year Treasury yields eased to 4.38 per cent from 4.45 per cent late on Tuesday. The 2-year yield sank to 4.76 per cent to from 4.82 per cent.

Crude Oil and Bullion Market Updates

Oil prices slipped on Wednesday as the International Energy Agency (IEA) trimmed its forecast for 2024 oil demand growth. Brent crude futures were down 54 cents or 0.6 per cent at $81.84 a barrel. US West Texas Intermediate crude futures (WTI) fell 50 cents or 0.6 per cent to $77.52 a barrel. On the other hand, gold prices climbed to a more than three-week peak, aided by a weaker US dollar. Spot gold rose 0.4 per cent to $2,367.29 per ounce, while US gold futures rose 0.6 per cent to $2,372.70. Spot silver rose 1.5 per cent to $29.03 per ounce.

Conclusion

The easing of consumer inflation and the subsequent surge in US stocks indicate a positive outlook for the US economy. With hopes of interest rate cuts from the US Federal Reserve, investors remain optimistic. However, the flat retail sales and fluctuating oil and gold prices suggest that the market remains volatile and unpredictable.