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Update: Communication Services, Technology Lift US Equity Indexes After August Inflation Print Triggers Rally in Shorter-Maturity Treasury Yields

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(Updates with index/price moves, macroeconomic data, comments and geopolitical news from the first paragraph.)

US equity indexes rose amid a broad-based rally led by communication services and technology, after August's consumer price inflation data sparked a rise in short-term government bond yields and crude oil slumped.

The Nasdaq Composite jumped 1.2% to 26,391.5, the S&P 500 climbed 1.1% to 7,671.1, and the Dow Jones Industrial Average advanced 1.1% to 52,642.2 ahead of Friday's close. All sectors rose, with industrials among the top gainers.

The consumer price index rose 0.4% month on month, the fastest pace since May and above July's 0.1% gain, the Bureau of Labor Statistics data showed Friday. The move matched the Bloomberg-polled consensus. Core inflation, which excludes the more volatile food and energy components, jumped to a four-month high of 0.3%, exceeding market projections for an unchanged 0.2% growth. On an annual basis, headline inflation held steady at 3.4%, as expected. The annual core measure eased to 2.4% from 2.5%, also in line with projections.

Another iteration of inflation, the supercore - defined as core services excluding housing - jumped 0.5% in August, marking the largest monthly gain in four months, according to a Stifel note. Over the past 12 months, the supercore increased 3.0%, accelerating from the 2.8% gain in July and marking the fastest pace since June, per the note.

Last month, Fed Chair Kevin Warsh reiterated the Fed's commitment to eventually reinstating price stability, a welcome sentiment but a reality already five years in the making, leaving market participants still skeptical of not only the potential for a rate increase next week, but a follow-through with additional hikes into year-end, the Stifel note said. "There is no doubt the Fed should raise rates, but the question remains: Will they?"

Most US Treasury yields rose in the final leg of trading, with outsized gains concentrated in shorter maturity securities. The two-year shot up 9.4 basis points to 4.64%, the highest since mid-2024. The 10-year yield climbed 3.1 basis points to 4.98%, the strongest level since October 2023.

A six-member bloc of Gulf states is weighing a meeting with Iranian officials next week to discuss the future of the Strait of Hormuz, people familiar with the matter told Bloomberg, in what would be the first gathering with the Islamic Republic since war erupted more than six months ago. Oman is aiming to get foreign ministers from the Gulf Cooperation Council and Iran together on Monday in Salalah, a southern Omani city, people familiar with the matter told the news agency.

The front-month US West Texas Intermediate crude oil contract slumped 2.3% to $100.16 per barrel, and global benchmark North Sea Brent dropped 2.9% to $104.52 per barrel.

What else is happening in Japan?

Japan

US Equity Markets End Lower as Crude Oil Surges, Bond Yields Rise

US equity indexes ended lower Thursday after crude oil surged and government bond yields rose.* The Bureau of Labor Statistics' wholesale price inflation gauge, the Producer Price Index, jumped 5.4% in August from a year earlier, above the 5.3% forecast in a Bloomberg survey, and up from 4.8% in July.* Core PPI, which excludes volatile food and energy prices, climbed 4.6% from a year earlier, as expected, and up from 4.3% in July.* Initial jobless claims last week fell to 206,000 from an upwardly revised 207,000 in the previous week, compared with expectations for 205,000 in a Bloomberg poll.* Iran-aligned Houthis seized control of Yemen's port city of Mokha, military sources said, gaining further leverage over the Bab el-Mandeb Strait, the southern outlet of the Red Sea, Reuters reported.* October West Texas Intermediate crude oil rose $6.89 to settle at $102.94 per barrel, while November Brent crude, the global benchmark, was last seen up $7.05 at $108.26.* Cooper Companies (COO) shares fell 15%, the steepest drop on the S&P 500, after the company cut its fiscal 2026 guidance. BofA Securities downgraded the stock to neutral from buy and lowered its price target to $65 from $80.* Apple (AAPL) is apparently prioritizing volume gains over margins with its lower-than-expected pricing on the new iPhones, including its first-ever foldable smartphone, Morgan Stanley said. Apple shares rose 3.6%, the top gainer on the Nasdaq.

Dow JonesNasdaq CompositeS&P 500$AAPL$COO
Japan

Update: US Equity Indexes Fall as Hot Producer Prices, Soaring Crude Oil Boost Treasury Yields

(Updates with index/price moves, macroeconomic data, comments and company/geopolitical news from the first paragraph.)US equity indexes fell as crude oil and government bond yields soared after an inflation gauge grew at the quickest pace in three months and an Iran-aligned militia group's threat to the alternative shipping route to the Strait of Hormuz escalated.The Nasdaq Composite declined 0.6% to 26,091.2, the S&P 500 retreated 0.6% to 7,594.1, and the Dow Jones Industrial Average dropped 0.7% to 52,036.6 ahead of Thursday's close.The Bureau of Labor Statistics' wholesale price inflation gauge, the Producer Price Index, jumped 5.4% from a year ago in August, above the 5.3% forecast in a Bloomberg-compiled survey, and 4.8% in July. The PPI edged up 0.4% month over month, as expected, following a 0.1% increase in July. The August print is the highest growth rate since May.Core PPI, which excludes volatile food and energy prices, climbed 4.6%, as anticipated, from a year ago, and up from 4.3% in July. Core PPI climbed 0.2%, below July's 0.3% and the 0.3% forecast."Based on the timing of the PPI survey, we expect another rise in September's report, as diesel prices have climbed nearly 60 cents and gasoline prices have risen close to 20 cents during the survey window, which is in the middle of the month," Grace Zwemmer, US economist at Oxford Economics, said in a note.US Treasury yields traded sharply higher in the final leg of trading. The two-year soared 13.3 basis points to 4.56%, and the 10-year yield surged 11.7 basis points to 4.96%.Iran-aligned Houthis seized control of Yemen's port city of Mocha on Thursday, military sources said, gaining further leverage over the Bab el-Mandeb Strait, the southern outlet of the Red Sea, according to a report from Reuters. Bab al-Mandeb is a geopolitical chokepoint similar to the Strait of Hormuz linking Asia and Europe via the Suez Canal.Saudi Arabia reported to the Organization of the Petroleum Exporting Countries that its crude oil production plunged again last month, down by 1.9 million barrels a day to 6.238 million barrels, the lowest since 1990, as renewed hostilities between the US and Iran squeezed the kingdom's export routes, Bloomberg reported.The front-month US West Texas Intermediate crude oil contract catapulted 6.3% to $102.06 per barrel, and global benchmark North Sea Brent shot up 6% to $107.23 per barrel.

Dow JonesNasdaq CompositeS&P 500
Japan

Update: US Equity Indexes Drop as Treasury Yields Jump Following Hot Producer Price Inflation Print

(Updates with index/price moves, macroeconomic data, and geopolitical news from the first paragraph.)US equity indexes fell after an inflation gauge jumped at the quickest pace in three months while an Iran-aligned militia group's threat to the alternative shipping route through the Strait of Hormuz grew stronger.The Nasdaq Composite declined 0.5% to 26,125.1, the S&P 500 retreated 0.5% to 7,598.2, and the Dow Jones Industrial Average dropped 0.6% to 52,078.3 after midday Thursday.The Bureau of Labor Statistics' wholesale price inflation gauge, the Producer Price Index, jumped 5.4% from a year ago in August, above the 5.3% forecast in a Bloomberg-compiled survey. The PPI edged up 0.4% month over month, as expected, following a 0.1% increase in July. The August print is the highest growth rate since May.US Treasury yields jumped after midday. The two-year soared 11 basis points to 4.54%, the highest since mid-2024. The 10-year yield surged eight basis points to 4.92%, its strongest level since late 2023.Iran-aligned Houthis seized control of Yemen's port city of Mocha on Thursday, military sources said, gaining further leverage over the Bab el-Mandeb Strait, the southern outlet of the Red Sea and an important shipping route, according to a report from Reuters.The front-month US West Texas Intermediate crude oil contract jumped 4.8% to $100.68 per barrel, and global benchmark North Sea Brent advanced 4.9% to $106.21 per barrel.

Dow JonesNasdaq CompositeS&P 500