S&P retreats, yen surges, Tesla sinks

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Tech retreat
The S&P 500 and Nasdaq Composite retreated from record highs as investors pivoted away from Big Tech, like Nvidia and Meta Platforms. The declines follow the lowest consumer price index in over three years. The Dow Jones Industrial Average saw a modest gain of 32 points, while the small-cap Russell 2000 Index rose 3.6%. The yield on the 10-year Treasury fell, while U.S. oil prices rose on hopes of a rate cut. You can read more from CNBC’s Jesse Pound on why Thursday was a historically strange day in the stock market. 

Cooling inflation
June inflation fell for the first time in over four years, providing more support for an interest rate cut. The consumer price index, a broad measure of costs, dipped 0.1% from May, putting the 12-month rate at 3%, the lowest in more than three years. The Fed is “one step closer to a September rate cut,” said Chris Larkin, managing director of trading and investing at E-Trade. “A lot can happen between now and September 18, but unless most of the numbers pivot back into ‘hot’ territory, the Fed’s reasoning for not cutting rates may no longer be justified.” 

Japanese yen surges
The Japanese yen surged 2% against the U.S. dollar on Thursday, marking its biggest daily gain since late 2022. The move appeared to be triggered by cooler-than-expected U.S. inflation data. Kit Juckes, global head of foreign exchange strategy at Societe Generale, told CNBC via email that the “driver of the yen rally is big shorts and a surprise in CPI.” This comes as traders closely watch for potential intervention by Japanese authorities, who have been trying to support their weakening currency.

Delta sinks
Delta Air Lines‘ shares dropped 4% after forecasting lower-than-expected third-quarter revenue, despite record summer travel demand. The carrier expects sales to rise no more than 4%, falling short of analyst estimates of 5.8% growth. This comes as airlines grapple with increased costs and expanded capacity putting pressure on fares, even as passenger numbers surge. Delta also expects to take a $100 million hit from the Paris Olympics. 

‘Robotaxi delay’
Tesla‘s share price dropped more than 8% after Bloomberg reported the automaker would push back unveiling its robotaxi from August to October. The delay, attributed to additional time needed for prototype development, reverses Tesla’s 11-day stock rally. CEO Elon Musk has been promising a robotaxi for years but has yet to deliver on his earlier predictions of fully autonomous driving.

[PRO] What Wall Street expects
JPMorgan is set to release its earnings report before the market opens on Friday. Investors will be closely watching…