Investing.com — U.S. stock markets opened higher on Friday but quickly ran into fresh selling amid only selective bargain-hunting among tech stocks that had sold off heavily again on Thursday.
The market was supported at the open by strong earnings posted after the close on Thursday by both software giant Oracle (NYSE:ORCL) and Peloton Interactive (NASDAQ:PTON), the maker of high-end exercise bikes. To a degree, the reports restored some confidence in the narrative that had driven the rally in the Nasdaq through the summer, namely that the disruption from the pandemic will bring accelerated benefits to companies that facilitate remote working – or working out.
But Peloton stock fell 2.8%, and Oracle stock rose 0.3%.
Earlier, participants had shrugged off figures showing stronger-than-expected inflation in the U.S. in August. The consumer price index rose 0.4% to be up 1.3% on the year. After adjusting for volatile food and energy prices, the core CPI rose 0.4% to 1.7%, its highest since April and apparently back on course toward the Federal Reserve’s target of 2%. Given that the Fed has now said it will tolerate an overshoot of the 2% target to compensate for the time inflation has undershot, there is effectively no reason to fear it will tighten policy as a pre-emptive step.
The index was propelled higher by surging prices for used cars – as people shun public transport – and by higher costs for moving house and the storage of household goods, testimony to the surge in housing market activity since the pandemic began.
Elsewhere, gains were relatively muted at the end of a week that has shown that prices can go down as