Stan Choe, AP Business Writer
NEW YORK (AP) – U.S. stocks are drifting to record highs Monday as Wall Street awaits future updates on inflation.
The S&P 500 had virtually no change and had flirted two weeks ago with the best set of all time. The Dow Jones industrial average fell 141 points (0.3%) as of 1:04pm ET, while Nasdaq Composite rose 0.2%, falling off its own record.
Wall Street’s highlights could arrive on Tuesday when the government reports how bad inflation across the country is in July. Economists expect that consumers will have to pay prices for food, gasoline and other living expenses, a 2.8% increase from the previous year in July, a slight acceleration from the 2.7% in June.
Inflation is above 2%, even if it has improved significantly from its peak at over 9% three years ago. And the worry is that President Donald Trump’s tariffs can push it higher.
This creates fear about a potential worst-case scenario called “stagflation,” where the economy is stagnant but inflation remains high. The Federal Reserve does not have the right tools to fix both at once, so they must first focus on the job market or inflation. However, supporting one of these areas by moving interest rates can hurt other regions.
Federal Reserve official Michelle Bowman said on Saturday that he considers the job market to be a greater concern. She supports three interest rates this year from the Fed following a weaker than expected report on the US job market this month. Trump himself is also angrily sought to cut interest rates to support the economy.
Other Fed officials, led by Chairman Jerome Powell, are more hesitant. Powell said he would like to wait for more data on how Trump’s tariffs will affect inflation before the Fed makes the next move. Tuesday’s update on the consumer price index may provide a big clue about that.
Stifel strategists have warned that Stagflation may already be on the way in as spending by US consumers slows down, and that by the second half of the year the US economy could slow the crawl. This could allow investors to create calculations for investors after the stock price rises from the low points in April.
According to a strategist led by Thomas Carroll and Barry Bannister, “rate reductions won’t save the overrated S&P 500.”
One way that companies can make their stocks look cheaper is to bring greater profits.
Micron Technology rose 3.1% on Monday after raising its earnings and revenue forecasts for the quarter, which closes later this month. The computer memory manufacturer said it benefits from the high price of the product.
AMC Entertainment rose 2.4% to shave its losses so far. This was the day at 26.4% after analysts reported better results than expected. According to the theater chain, movie fans are paying more for tickets per person than ever before, spending more on food and drinks with that number.
TKO Group Holdings rose 8.5% after signing a deal to distribute the full slate of events with 13 Marquee UFC numbers along with 30 “Fight Nights” on the Paramount+ Streaming platform. Paramount Skydance stock fell 1.6%.
Nvidia and Advanced Micro Devices have made progress after US government officials confirmed they agreed to share 15% of revenue from chip sales with the US government. The two said in July that Washington could resume sales of advanced H20 and MI308 chips used in Chinese artificial intelligence development, but did not reveal a 15% reduction. Nvidia added 0.3% and AMD rose 1.3%.
The Wall Street loser was C3.AI after warning that the AI application software company could report an operating loss of as much as $124.9 million in the first quarter. CEO Thomas Siebel called the first quarter sales results “completely unacceptable,” with the stock down 23.5%.
In the overseas stock market, indexes were mixed amidst the predominantly modest movements in Europe and Asia.
In the bond market, the 10-year Treasury yield fell to 4.26% from 4.27% in the second half of Friday.
AP Business Writer Elaine Kurtenbach contributed.
Original issue: August 11, 2025 10:10am EDT
