S&P 500 Rises, Small Caps Outperform As July Consumer Price Index Fuels Fed Rate Cut Hopes: 5 ETFs to Watch Wednesday
Portfolio Pulse from Piero Cingari
The July Consumer Price Index report showed a slight decline in inflation, fueling hopes for a Federal Reserve rate cut. This led to a positive reaction in the stock market, particularly in tech and small-cap stocks. Key ETFs and stocks saw notable premarket movements.

August 14, 2024 | 1:36 pm
News sentiment analysis
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NEGATIVE IMPACT
The Invesco CurrencyShares Japanese Yen Trust (FXY) fell 0.2% in premarket trading as the U.S. dollar strengthened against the yen.
The U.S. dollar's strength against the yen, following the inflation report, negatively impacted FXY.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 50
POSITIVE IMPACT
AnaptysBio, Inc. (ANAB) rose 13% in premarket trading, reflecting strong performance among small-cap stocks.
AnaptysBio's significant premarket gain indicates strong investor confidence in small-cap stocks following the inflation report.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
Arm Holdings plc (ARM) saw a 3.1% premarket rise, driven by positive market reactions to the July CPI report.
Arm Holdings benefited from the overall positive sentiment in the tech sector following the inflation report.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 50
POSITIVE IMPACT
ASML Holding N.V. (ASML) saw a 2.1% premarket gain, driven by strong performance in the semiconductor sector.
ASML Holding's premarket gain reflects the strong performance of semiconductor stocks following the inflation report.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 50
POSITIVE IMPACT
Cardinal Health Inc. (CAH) rose 5.5% in premarket trading after the release of the July CPI report.
Cardinal Health's significant premarket gain reflects positive investor sentiment following the inflation data.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
The iShares Russell 2000 ETF (IWM) rallied 0.5% in premarket trading, with small-cap stocks outperforming.
Small-cap stocks, which are represented by IWM, saw significant gains due to the positive market sentiment following the inflation report.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
Kellanova (K) saw a significant premarket gain of 7.2% following the July CPI report.
Kellanova's substantial premarket gain indicates strong investor confidence following the inflation report.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
Micron Technology Inc. (MU) rose 3% in premarket trading, reflecting gains in the tech sector post-July CPI report.
Micron Technology's premarket rise is attributed to the positive market reaction in the tech sector following the inflation data.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 50
POSITIVE IMPACT
The Invesco QQQ Trust (QQQ) rose 0.3% in premarket trading, driven by gains in tech stocks following the inflation report.
Tech stocks, which are heavily weighted in QQQ, saw gains due to the positive market reaction to the inflation report.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The VanEck Semiconductor ETF (SMH) rose 0.9% in premarket trading, with semiconductor stocks leading gains.
Semiconductor stocks performed strongly, boosting SMH, as the market reacted positively to the inflation data.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60
POSITIVE IMPACT
The SPDR S&P 500 ETF Trust (SPY) rose 0.2% in premarket trading following the July CPI report, indicating positive market sentiment.
The slight decline in inflation and hopes for a Fed rate cut positively impacted the broader market, reflected in SPY's premarket rise.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Victoria’s Secret & Co. (VSCO) surged 16% in premarket trading, leading gains among small-cap stocks.
Victoria’s Secret's substantial premarket gain highlights strong investor interest in small-cap stocks following the inflation data.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 60