Hot CPI Hands the Fed a Hike

Welcome to LazyListen. This is The Daily Rip for today. Stocks closed higher on Friday, with the S&P 500 pushing past 7,600, led by strength in megacap technology and industrials.

Despite a hotter-than-expected inflation report, investors shrugged off concerns, though the data has clearly shifted expectations for the Federal Reserve’s next move. Let’s start with the macro setup. August’s core Consumer Price Index rose three-tenths of a percent, above the two-tenths expected, pushing annual core inflation to two-point-four percent.

Headline CPI climbed four-tenths for the month and three-point-four percent year-over-year, driven in part by a two-point-one percent jump in energy prices. This hotter inflation print has ramped up the odds of a Fed rate hike next Wednesday to around ninety percent, ending five straight meetings without a change. The Fed is now widely expected to raise rates for the first time in three years, putting Chair Powell under the spotlight.

The inflation surprise was partly fueled by a record increase in wireless phone service costs, which could reverse quickly, but the bigger picture is less forgiving. Oil prices remain elevated near one hundred dollars a barrel, tariffs persist, and ongoing data center investments keep upward pressure on prices. Real hourly earnings fell three-tenths of a percent year-over-year, squeezing consumer purchasing power amid rising costs.

This combination leaves the Fed with little wiggle room to dismiss inflation as transitory. Energy markets added to the pressure. Saudi Arabia shut down a seven-million-barrel-per-day pipeline that bypasses the Strait of Hormuz, a critical export route.

This came just hours after the inflation report and sent Brent crude above one hundred and four dollars a barrel for the week, with some analysts warning prices could surge toward one hundred and twenty if pipeline damage is severe. The pipeline closure, combined with regional tensions and reduced tanker traffic through the strait, has slashed Saudi crude exports to less than ten percent of normal levels. S.

diesel prices hit a record six dollars and five cents per gallon, up over sixty percent from a year ago, adding to inflationary concerns. Turning to notable stock moves, the nuclear energy sector saw some turbulence. Oklo, an advanced reactor developer, fell over nine percent after announcing a new one-billion-dollar at-the-market stock sale program, just a day after completing a similar offering that raised about a billion dollars.

The fresh capital raise signals the company’s ongoing need for funding to commercialize its technology, but it also dilutes existing shareholders and pushed the stock to a new 52-week low near thirty-six dollars. The new program could add roughly twenty-seven million shares if fully drawn, highlighting the capital-intensive nature of nuclear innovation. In related news, UBS downgraded NuScale, another nuclear player, to Sell and slashed its price target from ten to six dollars.

The analyst cited a lengthy construction timeline of over five years, no firm customer commitments, and an expected cash burn of seven hundred million dollars through 2028. NuScale’s shares dropped nearly sixteen percent on the downgrade, reflecting investor skepticism about near-term prospects. On the biotech front, Sellas Life Sciences, a late-stage cancer drug developer, plunged over fourteen percent after a third-party survival model circulated on social media challenged the odds of success for its Phase 3 REGAL trial.

The company did not release any official updates, but the model’s skepticism rattled investors, with the stock falling sharply on heavy volume. Sellas has a high short interest of nearly twenty-nine percent, indicating significant bearish sentiment. While this move is notable for Sellas shareholders, it doesn’t appear to have broader market implications.

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server backlog. This sector strength helped buoy the broader market despite inflation concerns. 15 billion dollars, boosted by physical media sales like vinyl, CDs, movies, and collectibles.

However, net income slipped slightly to thirteen million dollars from fifteen million the prior year. The stock jumped nearly fifteen percent on the news, showing investor interest in niche retail segments benefiting from physical media’s resurgence. Looking at quick movers, the energy and nuclear sectors dominated headlines due to pipeline disruptions and capital raises.

-driven demand, while biotech volatility centered on trial data speculation. Retail sentiment on Stocktwits highlighted names like GameStop, where Ryan Cohen’s recent purchase sparked buying interest, but these moves remain more community-driven than market-moving. For tomorrow’s watch list, keep an eye on the Federal Reserve’s policy decision next Wednesday.

With inflation hotter than expected and energy prices elevated due to geopolitical disruptions, the Fed’s move will be critical for markets. Also, monitor oil prices closely as pipeline issues persist, potentially impacting energy costs and inflation further. I.

hardware demand signals following Oracle’s strong cloud growth. Finally, biotech investors will want to track any official updates from Sellas Life Sciences amid ongoing trial uncertainties. In summary, the market heads into next week with inflation pressures mounting and energy disruptions escalating.

The Fed is poised to respond with a rate hike, while sectors like nuclear and biotech face funding and trial challenges. I. and cloud trends.

Keep a close watch on policy, energy, and earnings catalysts as markets digest these developments. Thanks for listening. Catch you next time on LazyListen.