Demand Imbalance Arbitrage

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Forecast Future Price Action

U.S. Stocks Open Lower as Inflation Data Surpasses Expectations and Carvana Plunges 20.5%


U.S. stocks opened sharply lower on Friday as investors reacted to hotter-than-expected inflation data from the Federal Reserve’s preferred gauge.[0] The Personal Consumption Expenditures (PCE) price index rose 0.6% in January for a year-over-year rate of 5.4%.[1] Core PCE prices, which exclude food and energy, increased 0.6% in January, rising 4.7% from a year ago.[2] At 9:47 a.m., the Nasdaq 100 (NDX), S&P 500 (SPX), and Dow Jones Industrial Average (DJIA) had respectively declined by 1.9%, 1.6%, and 1.4[3]

Separate data showed the University of Michigan’s consumer sentiment index rose 3% from January to February to 67, confirming a previously released preliminary report.[4] The report stated that the rise was a result of “improvement in the short-run economic outlook,”, however consumers still “continued to exhibit considerable uncertainty over short-run inflation.”.[5]

At 10 a.m., traders will be anticipating the release of new home sales data.[6] According to a poll of economists conducted by the Dow Jones, it is expected that new home sales have increased by 0.6% in January.[6] The previous month saw a 2.3% increase, which is a lower rise than this one.[6]

In single-stock news, Carvana (CVNA) plummeted 20.5% after the online auto dealer reported a sharp year-over-year decline in units sold (-23%) and revenue (-24%) in Q4.[7] The CVNA stated that it will be able to decrease operating costs by one billion dollars by the end of the 2nd quarter, without any personnel reductions.[5] “We expect these expense reductions to be broad-based across all large SG&A expense components, but importantly, we do not expect a reduction-in-force to be part of this plan,” Carvana said in a letter to shareholders.[5]

Prior to the start of the market, Adobe (ADBE) experienced a decrease of more than 3% in its stock prices after Bloomberg News reported that the U.S. Justice Department is set to launch an antitrust lawsuit in order to halt the company’s takeover of Figma.[7] In pre-market trading, Moderna (MRNA) saw a decline of more than 2% following SVB Securities’ downgrade of the stock from ‘market perform’ to ‘underperform’.[8] Autodesk (ADSK) experienced a decrease of over 4% in pre-market trading following a prediction of 2024 billings to be between $5.03 billion and $5.[9]

0. “US stocks open sharply lower. Yields sharply higher” ForexLive, 24 Feb. 2023,

1. “Dow Jones Dives 500 Points On Hot Inflation Report; Tesla Stock Skids Below $200” Investor’s Business Daily, 24 Feb. 2023,

2. “U.S. stocks open sharply lower after hotter-than-expected inflation reading” MarketWatch, 24 Feb. 2023,

3. “Stock market news today: Dow falls 349 points after hot inflation data” Markets Insider, 24 Feb. 2023,

4. “So Long, Losing Streak? Stocks, Yields Climb as Market Mulls Fed Minutes, Hot Jobs Data, GDP – Ticker Tape” The Ticker Tape, 23 Feb. 2023,

5. “Stock Market Today: Hot Inflation Data Sinks Stocks” Kiplinger’s Personal Finance, 24 Feb. 2023,

6. “Stocks close lower Friday after hot inflation report; major averages log worst week in 2023: Live updates” CNBC, 24 Feb. 2023,

7. “S&P 500 set for biggest weekly loss this year as hot inflation stokes Fed fears By”, 24 Feb. 2023,

8. “Stocks Tumble as Strong Economic Reports Bolster the Case for Tighter Fed Policy” Barchart, 24 Feb. 2023,

9. “Markets Today: Stock Indexes Fall as PCE Inflation Accelerates” Barchart, 24 Feb. 2023,

Forecast Future Price Action
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