Hot Inflation Hits Rate-Sensitive Stocks: These 10 Names Are Falling
I'm LongbridgeAI, I can summarize articles.Hotter-than-expected September CPI at 3.7% triggered declines in rate-sensitive stocks during premarket trading. Gold miners dominated the top ten decliners, with Rocket Companies leading the drop as Treasury yields rose and the dollar strengthened. The inflation data kept Federal Reserve rate hike bets alive, impacting mortgage lenders, AI cloud providers like CoreWeave, and retailers such as Wayfair due to higher borrowing costs.
A hotter-than-expected inflation report is hitting rate sensitive stocks in premarket trading Wednesday.
September consumer prices rose 3.7% from a year earlier, above the 3.6% economists expected. Core inflation, which strips out food and energy, also topped forecasts, coming in at 2.6% versus 2.5% expected.
Treasury yields jumped, the dollar rose and gold fell.
“Wednesday’s CPI was stronger-than-expected, and it’s clear as ever that inflation is stubborn and moving in the wrong direction,” commented Skyler Weinand, chief investment officer at Regan Capital.
Read Also: Inflation Comes in Hotter Than Expected at 3.7%, Keeping Fed Hike Bets Alive
These are the 10 biggest premarket decliners among U.S.-listed stocks with a market cap of at least $10 billion, according to Benzinga Pro data.
Gold Miners Dominate The List
Seven of the 10 stocks are miners, and six of them mainly produce gold or silver.
Gold fell 1.1% to $4,116 an ounce. Silver dropped 2.0% to $57.96.
The dollar index rose 0.4%, and the 2-year Treasury yield climbed 11 basis points to 4.91%.
Gold pays no interest, so higher yields make it less attractive to hold.
| Company | Premarket Change | Price | Sector | Industry |
|---|---|---|---|---|
| Rocket Companies Inc. (NYSE:RKT) | -3.33% | $10.57 | Finance | Finance/Rental/Leasing |
| Harmony Gold Mining Co. Ltd. (NYSE:HMY) | -2.72% | $16.48 | Non-Energy Minerals | Precious Metals |
| CoreWeave Inc. (NASDAQ:CRWV) | -2.56% | $72.77 | Technology Services | Packaged Software |
| AngloGold Ashanti plc (NYSE:AU) | -2.52% | $90.75 | Non-Energy Minerals | Precious Metals |
| Equinox Gold Corp. (NYSE:EQX) | -2.49% | $10.60 | Non-Energy Minerals | Precious Metals |
| Alamos Gold Inc. (NYSE:AGI) | -2.44% | $31.24 | Non-Energy Minerals | Precious Metals |
| Hecla Mining Co. (NYSE:HL) | -2.43% | $15.76 | Non-Energy Minerals | Precious Metals |
| Hudbay Minerals Inc. (NYSE:HBM) | -2.40% | $25.30 | Non-Energy Minerals | Other Metals/Minerals |
| Wayfair Inc. (NYSE:W) | -2.34% | $106.00 | Retail Trade | Specialty Stores |
| Gold Fields Ltd. (NYSE:GFI) | -2.33% | $36.12 | Non-Energy Minerals | Precious Metals |
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Higher Rates Hit Mortgage Lenders
Rocket led the decliners, down 3.3%. The mortgage lender is sensitive to long-term rates, which drive what borrowers pay for a home loan.
The 10-year Treasury yield rose 7 basis points to 5.29%. The average 30-year mortgage rate was 7.5% last week, according to the Mortgage Bankers Association.
Redfin said Wednesday that home sellers now outnumber buyers by 63%, the widest gap in at least 13 years.
Morgan Stanley and JPMorgan both cut their price targets on Rocket on Monday.
AI Cloud Provider Faces Higher Borrowing Costs, Retail And Copper Sink
CoreWeave fell 2.6%. The company builds AI data centers with borrowed money, so the cost of debt matters for the stock.
Wayfair, which sells furniture and home goods, fell 2.3%. Hudbay, a copper and gold producer, fell 2.4%.
Producer prices follow on Thursday, with economists expecting a 0.5% monthly increase. The Fed meets October 27-28.
Image: Shutterstock
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