[New York Stock Exchange] Major Indices Open Lower as February PPI Exceeds Expectations

Focus on March FOMC... Rate Hold Likely
Tech Stocks Broadly Weaker
Global Oil Prices Rise

On March 18 (local time), ahead of the Federal Open Market Committee (FOMC) policy rate decision for March, all three major U.S. stock indices opened lower after the U.S. Producer Price Index (PPI) for February exceeded expectations.

As of 9:54 a.m. at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average was down 146.65 points, or 0.31%, at 46,846.61. The S&P 500 Index, which is weighted toward large-cap stocks, dropped 19.39 points, or 0.28%, to 6,696.79, while the tech-heavy Nasdaq Composite fell 51.90 points, or 0.23%, to 22,427.63.

Before the market opened, the U.S. Department of Labor's Bureau of Labor Statistics announced that the PPI for February rose 0.7% from the previous month. This figure surpassed the 0.3% gain anticipated by experts surveyed by Dow Jones. On a year-over-year basis, the PPI increased by 3.4%.

The rise in final demand services prices, which went up 1.1% compared to the previous month, contributed to the overall increase in the index. CNBC noted that this indicates inflation was already unstable even before the Iran war.

The core PPI, which excludes volatile components such as energy, food, and trade prices, also rose 0.5% from the previous month, surpassing the expert forecast of 0.3%. This marks ten consecutive months of increases. Compared to the same period last year, it rose by 3.5%.

Todd M. Schoenberger, Chief Investment Officer (CIO) at Crosscheck Management LLC, pointed out, "The higher-than-expected inflation rate is due to tariffs," noting price increases across metals, industrial raw materials, and manufacturing costs.

CIO Schoenberger added, "This is not a temporary phenomenon but structural inflation, and it is highly likely to affect monetary policy through the latter part of the third quarter."

According to Investing.com, as of this time, West Texas Intermediate (WTI) crude is trading at $98.13, up 2.72% from the previous session. Brent crude is also up 5.33% at $108.93 compared to the previous session.

Refining stocks such as ExxonMobil (+0.18%) and Chevron (+0.51%) are trending higher. Energy sector stocks, including Occidental Petroleum (+1.28%), Diamondback Energy (+0.93%), and APA (+0.88%), are also rising. Airline stocks, such as Delta Air Lines (+0.09%), American Airlines (+0.81%), and United Airlines (+1.16%), continue to move upward as well.

Investors are focusing on the March FOMC announcement scheduled for later this afternoon. The market expects the policy rate to be held steady at 3.50% to 3.75%.

Technology stocks are broadly weaker. Nvidia is down 0.04%, Apple -0.29%, Microsoft -0.43%, Amazon -0.92%, Alphabet -0.77%, Tesla -0.41%, and Meta -0.66%.

There is heightened attention on Micron Technology regarding its earnings. The semiconductor manufacturer is set to announce its quarterly results after the market closes. Its share price has surged by about 62% so far this year.

Anthony Saglimbene, Chief Market Strategist at Ameriprise Financial, commented, "The market is showing some hesitation ahead of the Fed's decision and elevated oil prices." He added, "While a rate hold is likely, investors will be watching closely to see how policymakers interpret the potential impact of the Iran conflict on inflation risks and growth prospects."

This content was produced with the assistance of AI translation services.