Wall Street holds mostly steady following the latest update on inflation
[August 27, 2026] By
STAN CHOE
NEW YORK (AP) — The U.S. stock market drifted through a quiet day of
trading Wednesday after a report said inflation was a touch worse last
month than economists expected. Yields in the bond market, home to some
of Wall Street’s biggest recent worries, edged higher following the
data.
The S&P 500 edged down by less than 0.1% and remains near its all-time
high set earlier this month. The Dow Jones Industrial Average dipped 113
points, or 0.2%, and the Nasdaq composite slipped 0.1%.
Stocks made relatively few big moves ahead of the latest earnings report
from the market’s most influential company, Nvidia, which arrived after
trading ended for the day. Expectations were high once again for the
chip giant, whose tremendous growth in profit because of the
artificial-intelligence boom has made it the largest stock by value in
the U.S. market.
After soaring for years, AI stocks have become shakier on worries that
their prices shot too high and that demand for chips may fizzle out if
AI does not produce as much profit as hoped.
Strong profit growth across U.S. companies broadly has been the main
reason the U.S. stock market has run to records this year.
Abercrombie & Fitch leaped 35.7% after reporting a stronger profit for
the latest quarter than analysts expected. The retailer also raised its
forecast for earnings over the full year and for how much cash it will
send to investors by buying back shares of its own stock.
J.M. Smucker climbed 4.3% after likewise reporting sweeter results than
expected for the spring. The seller of Folgers coffee and Smucker’s jams
also raised its forecast for profit over the full year.
On the losing end of Wall Street was Intuit, even though the company
behind TurboTax, Credit Karma and QuickBooks topped analysts’ profit
expectations in the latest quarter. It fell 3.2% after giving a forecast
for profit growth of nearly 25% in its upcoming fiscal year, which fell
short of analysts’ expectations.
Outside of earnings reports, Meta Platforms added 1.1% after agreeing to
pay up to $18 billion and to add child-safety measures to Facebook and
Instagram to end a landmark trial over teen social media addiction and
settle claims filed by states across the country.
All told, the S&P 500 slipped 1.58 to 7,675.70 points. The Dow Jones
Industrial Average dipped 113.52 to 53,463.88, and the Nasdaq composite
fell 21.10 to 26,130.20.
In the bond market, which has been home recently to some of Wall
Street’s strongest action, Treasury yields ticked higher following
updates on inflation and economic growth.
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Trader Robert Charmak works on the floor of the New York Stock
Exchange in New York, Friday, Aug. 21, 2026. (AP Photo/Yuki Iwamura)
 Yields had shot upward through the
summer on worries about high inflation and the U.S. government’s
growing and gargantuan debt, among other factors. They got so high
that the U.S. Treasury Department made a surprise announcement last
week to intervene in the bond market, though analysts say its effect
could be limited.
The latest update on inflation released Wednesday said that the
measure the Federal Reserve has historically preferred to use sat at
3.7% last month. That was the same rate of inflation as in June and
slightly worse than the 3.6% that economists expected, according to
FactSet. It remains far worse than the 2% goal the Fed has set.
Growth in spending by U.S. consumers, which is the main engine of
the economy, slowed at the same time.
The overall economy grew at a 1.5% annual pace in the spring,
according to a revised estimate of its performance, the same amount
as the government’s first estimate.
It all helped Treasury yields squiggle up and down before the
10-year Treasury yield edged up to 4.65% from 4.64% late Tuesday.
Traders didn’t change their forecasts much for what the Federal
Reserve will do with its main interest rate in the short term, and
they are betting on a nearly three-in-four chance the Fed will hike
the federal funds rate at least once by the end of the year,
according to data from CME Group.
One of the factors that’s worsened inflation this year is higher oil
prices, though they’ve come down recently.
The price for a barrel of Brent crude, the international standard,
continued to swing Wednesday on uncertainty about when the war with
Iran will allow oil tankers to freely exit the Persian Gulf again.
It dropped as low as $84.56 before settling at $86.94. That’s down
0.4% from the day before and from $94 at the end of last week.
In stock markets abroad, indexes rose across much of Europe and
Asia. South Korea’s Kospi climbed 1%, and Japan’s Nikkei 225 rose
0.6% for two of the bigger moves.
___
AP Business Writers Yuri Kageyama and Michelle Chapman contributed
to this report.
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