US stocks mixed midday as tech stocks fall despite July inflation data matching expectations

12:10pm: US stocks mixed midday as tech stocks fall  US stocks were mixed midday as investors reacted to an expected jump in inflation. However, the Dow Jones Industrial Average managed to rise 200 points and hit a new intra-day high.  As of noon, the DJI was up 169 points, or 0.48% at 35,431, while the broader-based S&P 500 increased a slight 1.56 points, or 0.04%, to 4,438. The tech-heavy Nasdaq, meanwhile, fell 81 points, or 0.55%, to stand at 14,706. Chris Beauchamp, chief market analyst at online trading group IG, noted that overall US price growth is slowing, which is a good sign for stocks.  “Slower growth in US prices has given the ‘all clear’ for equities to move higher this afternoon, after a very cautious start to the day for equities generally,” he wrote. “Nonetheless, concerns about higher prices haven’t gone away entirely.” The biggest gainer on the day so far is Meggit PLC, up 24% to $12.07 a share.  9.45am: Early gains for Wall Street The main US indices started positively on Wednesday as the latest inflation figures, while elevated, arrived in line with what the market expected. After a quarter of an hour of trading, the Dow Jones Industrial Average was up 209 points, or 0.6% at 35,473, while the broader S&P 500 climbed 0.3% and the Nasdaq Composite added 0.1%. US price inflation slowed in July but still remained near historic highs as supply chain disruptions continued and economic reopening caused a rise in demand for travel services. The consumer price index (CPI) rose 0.5% in July, down from the 0.9% increase in June, while the core CPI rose 4.3% year-on-year compared to 4.5% the month before. Despite the slowdown in the rate of inflation, the rate of price increases is still elevated and is predicted to remain so into next year. The swift economic rebound following the reopening on most parts of the US economy has contributed to inflationary pressure in recent months, while a shortage of semiconductors has driven up prices of used cars, contributing to the increase. The data will be closely eyed by the Federal Reserve as it continues to mull its options to taper its stimulus programme that has pumped trillions of dollars into the economy during the pandemic. 6.55am: CPI creates uncertainty US stocks are expected to beat a retreat on Wednesday ahead of closely watched July inflation data and as Treasury yields rose for the seventh day in a row. Futures linked to the Dow Jones Industrial Average were a touch lower, while S&P 500 futures lost 0.1%, and Nasdaq-100 futures fell 0.2%. US consumer prices are forecast to rise by 5.3% year-over-year in July, slightly lower than June’s 5.4% jump but still close to the highest 12-month rate since 2008. The core CPI, which excludes food and energy prices, is expected to have increased by 4.4% from the year before The Federal Reserve is still betting that elevated inflation readings will be temporary, a key part of its easy-money policies, but after last week's stronger than expected July payrolls report a tapering by the US central bank is on the cards sooner rather than later. In bond markets, the yield on the 10-year Treasury note ticked higher. The Senate passed a $3.5 trillion budget blueprint early Wednesday, the first step in an arduous process designed to allow Democrats to push through a sweeping package of education, healthcare, climate and other provisions without Republican support. Investors are awaiting another batch of corporate earnings, with Wendy’s set to report before the market opens, and eBay after the market closes. Five other things to watch on Wednesday: The current inflation spike shouldn't push the Federal Reserve to tighten monetary policy prematurely, with more months of labor data needed before any changes as well as more certainty that the pace of price increases will remain above the Fed's 2% target, Chicago Fed president Charles Evans said on Tuesday. NortonLifeLock Inc. has agreed to acquire and combine with cybersecurity firm Avast PLC in a cash-and-stock deal that would extend the US company’s focus on consumer software. Boeing Co (NYSE:BA) said a 737 MAX test plane took to the skies in China on Wednesday as the US firm looks to end a nearly two-and-a-half-year regulatory grounding of the model in the key travel market following crashes. Exxon Mobil Corp has begun marketing US shale gas properties as it ramps up a long-stalled program that aims to raise billions of dollars to shed unwanted assets and reduce debt taken on last year, according to Reuters. US President Joe Biden will convene a summit with leaders from democratic nations on December 9 and 10, 2021, as part of a sustained effort to shore up the foundation of such governments, the White House said on Wednesday.