Texas markets

Market update: Inventories rise for first time in three weeks; Upcoming Inflation Report

Stocks ended higher for the first time in three weeks, with the Morningstar US Market Index gaining 3.86%.

All sectors closed higher for the week, with Consumer Discretionary and Basic Materials leading the advance. Energy stocks lagged after a volatile week due to lower oil and gas prices.

The biggest winners are software vendors whose results have exceeded profits. Shares of solar energy companies rebounded from losses in the week ending September 2. Chinese ADR stocks led losses among U.S.-listed companies covered by Morningstar analysts.

Looking ahead, the latest Consumer Price Index report will be released on September 13th. Inflation rose to 8.5% for the 12 months to July, from 9.1% in June. Economists expect August’s numbers to continue this downward trend, with average inflation estimates falling to 8.1% over the past 12 months, according to FactSet.

August could also bring the first monthly decline in inflation since November 2020, with economists estimating the CPI fell 0.1% in August from July.

Events scheduled for the coming week include:

  • Monday: Oracle (ORCL) brings earnings.
  • Tuesday: The Consumer Price Index report for August will be released.
  • Wednesday: Producer Price Index data for August.
  • Thursday: US Retail Sales for August, Adobe (ADBE) brings earnings.

For the trading week ending September 9:

  • The Morningstar US Market Index rose 3.86%.
  • All sectors rose with consumer cyclicals, up 5.80% and basic materials, which gained 5.26%, as the best performers.
  • Yields on the 10-year US Treasury rose from 3.20% to 3.32%.
  • West Texas Intermediate crude oil prices fell 0.09% to $86.79.
  • Of the 861 U.S.-listed companies covered by Morningstar, 758, or 88%, were up and 103, or 12%, were down.

Which stocks are rising?

The best performing stocks were Zscaler (ZS)Regeneron Pharmaceuticals (REGN)Lyft (LYFT)Coinbase Global (PIECE OF MONEY)and Coupa software (CUT).

Regeneron Pharmaceuticals has soared following the latest results from its clinical trials of Eylea, a drug used to treat eye disease.

Cybersecurity firm Zscaler gained after reporting results that beat revenue and earnings-per-share estimates. Coupa Software, a provider of enterprise expense management solutions, rose on results that Morningstar equity analyst Julie Bhusal Sharma described as “a well-balanced earnings pace.”

Solar companies and other businesses set to benefit from the Cut Inflation Act rebounded from losses in late August, with Sunrun (CLASSES)Sun Power (SPWR)and charging point (CHPT) at the top.

A line chart highlighting some of the most important stock moves during the week.

Which stocks are down?

The worst performing stocks were bilibili (BILI)Sonic Automotive (SAH)VNET Group (VNET)Equine (EQNR)and Tencent Holdings (TCEHY).

A chart showing the worst performing stocks on Morningstar's U.S. Coverage List of the Week.

Chinese ADR shares fell, with video-sharing site Bilibili and data center operator VNET Group among the biggest decliners. Shares of Tencent Holdings ended the week lower.

Lower oil and gas prices contributed to lower energy stocks. WTI Crude Oil had a volatile week, ending at $86.79 after falling to a closing low of $81.94 on Wednesday, and nnatural gas prices fell more than 13%. Equinor, Occidental Petroleum (OXY)and Patterson-UTI Energy (PTEN) were among the worst performers in the group.

A chart highlighting some of the biggest stock declines of the week.