The major averages reverse course after touching new highs even as inflation data came in lighter than expected. The Dow Jones Industrial Average fell 220 points or 0.48%. The S&P 500 rose 19 points while the Nasdaq declined 6 points.

The latest producer price index reading showed that wholesale prices fell 0.1% in August. Economists polled by Dow Jones had estimated a 0.3% gain. Core PPI, which excludes food and energy prices, likewise declined 0.1%, while the consensus called for 0.3%. The report serves as a positive sign for rate cuts next week. The yield on the benchmark 10-year Treasury fell 4 basis points to 4.03%. The yield on the 30-year Treasury dropped 3 basis points to 4.67%. The 2-year declined a basis point to 3.52%.

The weakness in the Dow and Nasdaq came from Apple down 3%, a day after releasing their new line of products, including a new iphone for 2025. Amazon is also down 3%. The bigger is in the software space, with Oracle up over 35% on blow out guidance thanks to AI demand. Oracle expects to see $144 billion in cloud infrastructure revenue in the 2030 fiscal year, a substantial increase from $10.3 billion in fiscal 2025.

Other AI beneficiaries like Nvidia and Broadcom were up 3% and 8% respectively.

In the commodity space, oil was up nearly 2% on tensions in the Middle East and Russian drones shot down in Poland. Gold was quiet while bitcoin was up nearly 2%.

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