Futures Up, Oil Steady: PCE Inflation Impact

The Fed’s Favorite Measure of Inflation Stayed Hot in January

FROM 25 minutes ago

Inflation was hovering in a stubbornly high pattern, but not surging, before the Iran war sent energy prices spiraling.

Consumer prices as measured by Personal Consumption Expenditures rose 2.8% over 12 months in January, down from a 2.9% annual increase in December, the Bureau of Economic Analysis said Friday. That was less than the 2.9% increase forecasters had expected, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal.

On the other hand, the “core” PCE price index, which excludes the volatile prices for food and energy, rose 3.1% over the year, up from a 3% annual increase in December. That was a fresh high since early 2024 and matched forecaster expectations.

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–Diccon Hyatt

The Strait of Hormuz Is an ‘Acute Vulnerability’ for Global Trade. Here’s What You Need to Know

FROM 38 minutes ago

So much depends on a 21-mile wide passageway.

The world’s crude oil, gas, fertilizer, sugar, aluminum, basic plastics, helium, and other goods move through the Strait of Hormuz—which is now a chokepoint of the ongoing war in the Middle East. Iran’s new Supreme Leader Mojtaba Khamenei in his first released message to the media early Thursday vowed to continue blocking the strait as the rest of the world scrambles, with the magnitude of the resultant supply-chain disruption largely dependent on how long the fighting continues.

Governments and the International Energy Agency rode to the rescuewith plans to distribute an unprecedented amount from oil reserves. Markets experts say there isn’t enough spare capacity to address the potential shortfall. Still, oil prices remain aloft, and the de facto closure of the trade passageway threatens to prove consequential even for those far removed from the fighting in the Middle East.

“In the current environment, where the Strait of Hormuz is effectively closed, it is an acute vulnerability,” according to energy consultancy firm Rystad Energy.

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–Crystal Kim

How Long Will The Iran War Last? The Economy Depends On the Answer

FROM 1 hr 27 min ago

All economic forecasts now hinge on one question: how long will the Iran war last?

With unclear timelines from government officials, there are few details on how long the violence in the region will continue—and what kind of economic impact the fighting may have. Violence in the region continued on Thursday, and the important transportation route through the Strait of Hormuz remained effectively closed.

As a result, the price of Brent crude oil closed above $100 a barrel for the first time since August 2022, up from roughly $70 before the war. The longer the war continues, the greater the impact rising oil prices will have on the broader economy.

Read the full article here.

–Diccon Hyatt

Rivian Has Finally Launched the R2—Why the EV Maker’s Survival May Depend On It

FROM 1 hr 58 min ago

Rivian has unveiled eagerly awaited details on its R2 model, a launch that experts say could turn out to be a make or break moment for the EV maker.

The R2, which was introduced Thursday at the SXSW festival in Austin, is a smaller, more affordable SUV the company has made its goal since introducing a $76,990 R1S that was out of reach for most buyers. The Performance model starts at $59,485, and first deliveries will go to R1 owners this spring. Cheaper trims are coming, the company says, but not until 2027.

For a company burning through billions of dollars and whose stock price has dropped recently, the new model is one analysts say has to work if Rivian wants to stay in business. Despite the hoopla surrounding the R2, Rivian (RIVN) shares fell 8% on Thursday, pushing their year-to-date decline to 22%.

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–Peter Gratton

Adobe’s Stock Has Slumped for Two Years. Fixing That Is Someone New’s Job Now

FROM 2 hr 14 min ago

Adobe has had a tough time convincing investors to support its stock. Could a new CEO win them back?

Reviving interest in the once-hot software company’s shares will soon be the responsibility of someone new: CEO Shantanu Narayen plans to step down after 18 years on the job—and as soon as a successor is found, Adobe (ADBE) said Thursday.

The news comes as the yearslong slide for Adobe’s stock continued. Shares of the Photoshop and Illustrator owner were down over 7% in extended trading following the news despite quarterly earnings that topped analysts’ estimates.

Adobe for its fiscal first quarter reported adjusted earnings per share of $6.06 on a 12% year-over-year jump in revenue to a record $6.40 billion. Both figures came in above analysts’ estimates as compiled by Visible Alpha.

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–Kara Greenberg

Stock Futures Tick Higher Ahead of PCE Inflation Reading

FROM 2 hr 51 min ago

Futures contracts connected to the Dow Jones Industrial Average pointed up 0.2%.

S&P 500 futures were 0.1% higher.

Nasdaq 100 futures also pointed up 0.1%.