Nasdaq 100 falls as hot PCE inflation lifts rate-hike bets

U.S. equities drifted in a narrow band by midday Wednesday as investors refused to commit capital ahead of Nvidia Corp. (NASDAQ: NVDA ) ‘s after-the-bell results, while a hotter-than-forecast July inflation print revived talk of a September rate hike.

The Personal Consumption Expenditures (PCE) price index rose 0.2% month-over-month in July, matching forecasts of 0.1%, while the annual rate held at 3.7% versus expectations of 3.6%.

Core PCE held at 3.3% year-over-year, still well north of the Federal Reserve’s 2% target.

Second-quarter GDP growth was confirmed at an annualized 1.5%, down from 2.1% in the first quarter.

Nasdaq 100, the weakest major benchmark, dropped 0.6% to 29,041.12 for a 168-point decline.

S&P 500 slipped 0.1% to 7,668.85, shedding roughly 8 points.

Dow Jones Industrial Average fell 0.2% to 53,446.13, giving back about 123 points.

Russell 2000 fell 0.3% to 3,000.42, clinging to the 3,000 handle.

Gold sank 1.3% to $4,599.33 an ounce as in-line core inflation and firmer yields sapped bullion demand, dragging the SPDR Gold Shares (NYSE: GLD ) lower.

Bitcoin (CRYPTO: BTC) eased 0.7% to $78,000.

The yield on the 10-year Treasury note rose 4 basis points to 4.67% as the inflation data undercut the case for easing.

The 2-year yield added 4 basis points to 4.23%, while the 30-year held at 5.19%.

Traders now look to Fed Chair Kevin Warsh ‘s Jackson Hole address on Friday for direction ahead of the Sept.

16 policy meeting, with markets increasingly unwilling to rule out a hike.

Wednesday’s Performance In Major US Indices Index Last % Change MTD YTD S&P 500 7,665.85 -0.1% +2.4% +12.0% Dow Jones 53,420.85 -0.3% +1.8% +11.1% Nasdaq 100 29,041.12 -0.6% +2.7% +15.0% Russell 2000 3,000.42 -0.3% +2.4% +20.9% Updated by 12:30 PM ET According to the Pro platform: The Vanguard S&P 500 ETF (NYSE: VOO ) slipped 0.1%.

The SPDR Dow Jones Industrial Average ETF Trust (NYSE: DIA ) fell 0.3%.

The Invesco QQQ Trust (NASDAQ: QQQ ) declined 0.6%.

The iShares Russell 2000 ETF (NYSE: IWM ) eased 0.3%.

Energy Stocks Rise, Tech Holds Steady Ahead of Nvidia’s Results The Energy Select Sector SPDR Fund (NYSE: XLE ) led all 11 S&P 500 sectors with a 1.5% gain as crude reversed higher, extending its year-to-date advance to 42.7%.

The Industrials Select Sector SPDR Fund (NYSE: XLI ) followed at 1.1%.

At the other end, the Consumer Discretionary Select Sector SPDR Fund (NYSE: XLY ) and the Health Care Select Sector SPDR Fund (NYSE: XLV ) each fell 1.0%.

The Technology Select Sector SPDR Fund (NYSE: XLK ) held a 0.2% gain despite the Nvidia-related caution in the index.

Precious-metals equities took the worst of it, as the VanEck Gold Miners ETF (NYSE: GDX ) tumbled 2.7% alongside bullion and AngloGold Ashanti plc (NYSE: AU ) dropped 4.3%.

The Invesco WilderHill Clean Energy ETF (NYSE: PBW ) shed 1.5%, while the SPDR S&P Insurance ETF (NYSE: KIE ) rose 0.5% and the VanEck Agribusiness ETF (NYSE: MOO ) added 0.4%.

Pipeline Operators — The Day’s Cleanest Trade DT Midstream Inc. (NYSE: DTM ) rose 5.1%, The Williams Companies Inc. (NYSE: WMB ) gained 4.6% and Kinder Morgan Inc. (NYSE: KMI ) added 4.1% as natural gas jumped.

C.H.

Robinson Worldwide Inc. (NASDAQ: CHRW ) climbed 5.3% and The J.

M.

Smucker Company (NYSE: SJM ) rose 4.0%.

Semtech Corp. (NASDAQ: SMTC ) led the Russell 1000 with an 8.1% surge after reporting record fiscal second-quarter net sales of $341.9 million late Tuesday, up 33% year-over-year, with data center revenue hitting a record $100 million on 800G and 1.6T demand.

Semtech guided next-quarter revenue to roughly $410 million at the midpoint, about 15% above consensus.

TTM Technologies Inc. (NASDAQ: TTMI ) rose 6.6%, trading in sympathy with the AI-hardware complex ahead of Nvidia’s print.

Peers moved with it, as Arista Networks Inc. (NYSE: ANET ) gained 3.9% and Lumentum Holdings Inc. (NASDAQ: LITE ) added 3.8%.

Summit Therapeutics Inc. (NASDAQ: SMMT ) climbed 6.6%.

The move follows a roughly 25% one-month drawdown and comes ahead of the FDA’s decision on ivonescimab expected by mid-November.

Retail Delivers Session’s Other Upside Bath & Body Works Inc. (NYSE: BBWI ) jumped 6.4% after posting adjusted earnings of 62 cents per share against a 25-cent consensus and lifting full-year adjusted EPS guidance to $2.60-$2.80 from $2.40-$2.65, marking its first direct net sales growth since 2021 — enough to override a third-quarter forecast of 7 to 12 cents versus 26 cents expected.