Stock Market News from Monday, March 11, 2024: The Dow Drifted Higher in Quiet Trading Ahead of Inflation Report (2024)

What Happened Today

After a soft end to the prior week, the market will now focus on Tuesday’s release of the consumer price index for February and what it means for the prospect of the Federal Reserve beginning to cut interest rates. The consensus estimate is for a 3.1% year-over-year increase, matching the January figure that came in hotter than expected and triggered a stock fall.

Stocks wobbled on Monday in a mostly uneventful session ahead of a key inflation reading.

The Dow Jones Industrial Average was up 47 points, or 0.1%. The S&P 500 was down 0.1%. The Nasdaq Composite was down 0.4%. The Russell 2000 fell 0.9%.

The CBOE Volatility Index, or Vix, spiked to 16.04 before settling in with a gain of roughly 2.8% at 15.16 in recent trading.

The S&P 500’s materials sector led the day, followed by energy and consumer staples. Despite the benchmark’s decline, more individual stocks in the index than not closed the day higher.

Traders are bracing for Tuesday’s release of the consumer price index. Economists polled by FactSet are forecasting that consumer prices rose 3.1% in February from one year ago. A hotter-than-expected reading could spell trouble for stocks if it suggests inflation is proving more stubborn than expected.

Federal Reserve Chair Jerome Powell and other central bank officials have emphasized a need for sustained price stability before they can start cutting interest rates.

"Market expectations seem to be leaning towards another strong increase in core CPI, but we would caution that recent volatility in data implies greater-than-usual uncertainty and suggests not reading too much into any one month of data," write Citigroup economists Veronica Clark and Andrew Hollenhorst. "Even a softer increase, while likely very encouraging for Fed officials who seem set on cutting rates by mid-year, would not necessarily change our view on remaining underlying inflationary pressures."

The Dow Jones Industrial Average turned positive in afternoon trading after wobbling for much of the session.

The Dow, which was down almost 0.6% earlier in the session, turned up 29 points, or 0.1%, in recent trading. The S&P 500 and Nasdaq Composite were still down about 0.1% and 0.4%, respectively.

The Invesco S&P 500 Equal Weight ETF, which weighs each S&P 500 company the same, was up 0.1% because 283 components in the market benchmark were trading higher, compared with 219 stocks trading down.

The S&P 500 materials sector was leading the pack with a gain of 0.9%. The industrials sector was the biggest laggard with a decline of 0.9%.

"While it appears to be a risk-off day, with utilities and consumer staples still in the green, one of the most speculative assets, Bitcoin, has jumped to a new all-time high above $72K," writes Navellier & Associates founder Louis Navellier. "If the inflation news this week is better than expected it is likely that we will return to testing new highs."

The market’s fear gauge spiked on Monday ahead of key inflation readings later this week.

The CBOE Volatility Index, or Vix, briefly crossed 16 on Monday for the first time since Feb. 21, according to Dow Jones Market Data. The measure pulled back in early afternoon trading, but was still up 5.1%, to 15.49

The Dow Jones Industrial Average was down 27 points, or 0.1%. The S&P 500 was down 0.2%. The Nasdaq Composite was down 0.3%.

“Weak hands may be taking profits, with red ink well distributed,” writes Navellier & Associates founder Louis Navellier. “Today's market caution is due in part to the CPI and PPI data coming, which may confirm that marching from 3% inflation to the Fed's 2% target is likely to be challenging.”