Market Recap – Thursday, August 14, 2025
Stocks finish flat after hotter inflation reading
The stock market didn’t do much today. The S&P 500 barely moved, but still managed to notch another all-time high. The Dow was up just 0.02%, Nasdaq dipped slightly, and small-cap stocks gave back some of yesterday’s big gains.
The day started weak after a surprisingly hot inflation report (PPI), but markets rebounded a bit by the close. Banks, pharma, and credit card stocks did well, while homebuilders, China tech, industrials, and cosmetics lagged. Big Tech was mixed, though Amazon stood out on the upside. Meanwhile, Intel popped on news that the government might take a stake in the company, and Bitcoin dropped nearly 4% after a U.S. official said the government isn’t planning to buy more crypto.
The Producer Price Index (PPI) – which measures wholesale inflation – came in much hotter than expected, with prices rising 0.9% in July. That spooked some investors and lowered odds of a bigger Fed rate cut in September, though markets still expect a smaller 0.25% cut. On the job front, fewer people filed for unemployment than expected, suggesting continued strength in the labor market.
Elsewhere, oil prices jumped 2%, the U.S. dollar strengthened, and gold edged lower. In Fed news, San Francisco Fed President Daly said she’s not in favor of a 50bp cut and wants to avoid sending a message of panic.
Here’s Our Take
Despite hotter-than-expected inflation data, markets mostly brushed off the news, supported by strong earnings in key sectors and resilient job data. Investors are still betting on a rate cut next month, though hopes for a larger 50bp cut are fading. With Amazon boosting delivery capabilities and Intel potentially getting government support, some of the Big Tech names remain in focus. But stretched valuations, higher oil prices, and inflation surprises could keep volatility elevated. Tomorrow’s retail sales report and next week’s Jackson Hole speech from Fed Chair Powell will be key to watch for the next move in stocks.
P.S. Know someone who'd appreciate smarter stock insights and clearer investing strategies? Forward this email or share this link: subscribe.triplegains.com