Wall Street ends flat, but S&P hits another closing high as rate-cut bets waver

Wall Street ends flat, but S&P hits another closing high as rate-cut bets waver

By Saeed Azhar, Johann M Cherian and Sanchayaita Roy

Thu August 14, 2025 4:27 PM  

Yesterday’s ebullience was squashed today by a hot PPI report showing producer prices have surged to a 3 year high. This squelched the optimism about rate cuts for the rest of the year, though a ¼ point September rate cut is still very much on the books. However, the steeper rate cuts for the final three months of the year are now in considerable doubt. All three indexes all went well into the red, the Dow down some 230 by 1 pm, tech having similar difficulties. The lesson coming from today’s PPI is that prices have not only risen because of the tariffs but are now expected to keep rising as the duty impact proceeds to reveal itself.  

All three recovered to nearly flat by close, the S&P even squeezing out a trifling 1.96 point gain, which now gives it its 3^rd straight day of records. Another bit of good news is unemployment claims falling. However, the really bad news is that stocks have become very expensive, the S&P now trading at a multiple of 23, 40% over the 20-year average. That makes it ripe for a correction which would inevitably happen if the expected inflation boosts manifest themselves. Today volume came in at 16.3 billion, exactly 2 billion below the 18.3 4-week average. 

DJ: 44,922.27  +463.66      NAS: 21,713.14  +31.24       S&P: 6,466.58  +20.82        8/13

DJ: 44,911.26  -11.01          NAS: 21,710.67  -2.47          S&P: 6,468.54  +1.96          8/14

Thu 8-14-25 4:27 pm Wall Street ends flat, but S&P hits another closing high as rate-cut bets waver | Reuters