By Rita Nazareth and Kamaron Leach October 13, 2021, 5:54 AM GMT+8 Updated on 

  •  Prices paid by U.S. consumers rise by more than forecast
  •  Delta Air warns of jet-fuel costs, clouding profit rebound

Technology shares climbed amid lower Treasury yields after data showing inflation is running hot lifted companies seen as better equipped to pass on higher costs to consumers without harming their businesses.

The tech-heavy Nasdaq 100 outperformed major equity benchmarks, with giants Inc. and Microsoft Corp. rallying. The S&P 500 fluctuated. Benchmark 10-year yields remained below 1.6%, while the two-year rate — which is more sensitive to policy moves — rose. Delta Air Lines Inc. paced losses in U.S. carriers after saying rising jet-fuel prices are a threat to staying in the black.

Prices paid by U.S. consumers climbed in September by more than forecast, underscoring inflationary pressures. Unprecedented shipping challenges, materials shortages, high commodities prices and rising wages have driven up costs for producers. Many have passed a portion of those costs to consumers — leading to more persistent inflation. Upcoming minutes from last month’s Fed policy meeting should provide further insight.

“Wednesday’s still elevated consumer-price index marks about six-months worth of hot inflation data — suggesting that inflation is not as transitory as many investors previously expected,” said Nancy Davis, founder of the Greenwich, Connecticut-based firm Quadratic Capital Management. “The overall inflation story is being driven by supply-chain disruptions and a swift rise in prices, due to the labor shortage.”

Some corporate highlights:

  • JPMorgan Chase & Co.’s dealmakers posted their best quarter yet, riding what’s on track to be a record year for mergers and acquisitions. Still, shares fell as consumer and commercial loan growth remained challenged.
  • American Express Co. and other credit-card issuers tumbled as JPMorgan attributed weakness in its card business to rising costs on marketing and promotions, sparking concern over heightened competition.
  • BlackRock Inc.’s assets under management fell slightly to $9.46 trillion in the third quarter, as the world’s largest money manager navigated higher inflation and equity markets suffered their worst returns since the outbreak of Covid-19.
  • Apple Inc. dropped after Bloomberg News reported that the company will likely cut its projected iPhone 13 production targets for 2021.

Here are a few events to watch this week:

  • Bank of America Corp., Morgan Stanley and Citigroup Inc. report earnings on Thursday
  • U.S. initial jobless claims, PPI on Thursday
  • Goldman Sachs Group Inc. reports earnings on Friday
  • U.S. business inventories, University of Michigan consumer sentiment, retail sales on Friday