PPI Soft in June, Down 0.3%; Market Reaction Subdued as WTI Crude Approaches $80/Barrel; IBM Bellwether Drops 25%, Should Continue to Fall

On Tuesday, the BLS produced a rosy June CPI, with inflation easing due to lower oil and gas prices. That didn't inspire as big a rally as some may have expected, since lower inflation would encourage the Fed to keep interest rates where they are or even lower them. Another possibility is that the market is simply exhausted. Stocks have been sailing right along since 2023, with only minor breaks for presidential actions, specifically, Trump's "Liberation Day" tariffs in April, 2025, and the recent U.S.-Iran conflict from March.

Profits have been easy pickings, and there's a good possibility that institutional investors have seen enough, made enough, and are cycling out.

Still, stocks did show gains, despite the fallout from IBM's 25% drop, the worst in the company's history, as companies slash budgets for software and consulting, and Big Blue issued an ill-timed earnings warning. Anybody with a sense of history will understand why a bellwether stock like IBM should be trading at or below $100/share as opposed to the current fantasy of $217 to be considered fair value. When that happens - and it will - stocks will be worth buying again. The monstrous drop in shares of IBM was like a warning shot across the bows of many Wall Street trading desks.

The action in markets on Tuesday was strongly suggestive of recession fears emerging. The U.S. economy, despite the punditry and hype, could be leveling out at stall speed with GDP probably the worst measurement possible. There's no jobs growth and prospects for the next 6-12 months are cloudy at best.

So, today, the BLS follows up with a dovish PPI:

The Producer Price Index for final demand fell 0.3 percent in June, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.6 percent in May and 1.1 percent in April. On an unadjusted basis, the index for final demand increased 5.5 percent for the 12 months ended in June.

The June decline in the index for final demand can be attributed to prices for final demand goods, which fell 1.4 percent. In contrast, the index for final demand services moved up 0.2 percent.

The index for final demand less foods, energy, and trade services increased 0.1 percent in June after jumping 0.8 percent in May. For the 12 months ended in June, prices for final demand less foods, energy, and trade services rose 5.1 percent.

Market reaction was once again muted, though not without the customary knee-jerk response in stock futures, which leapt higher.

With the open less than half an hour ahead, Dow futures are up 142 points, NASDAQ futures are ahead by 181, and S&P futures are up 21 points, not exactly a ringing endorsement, but good enough to keep traders busy.

Gold also got a boost, just like it did yesterday, only to give back most of the gains. Silver is moribund at $58.65. Gold: $4070 per troy ounce.

WTI crude oil approaching $80 per barrel is keeping a lid on everything.

At the Close, Tuesday, July 14, 2026:
Dow: 52,508.27, +9.63 (+0.02%)
NASDAQ: 26,107.01, +233.83 (+0.90%)
S&P 500: 7,543.59, +28.25 (+0.38%)
NYSE Composite: 23,846.60, -49.45 (-0.21%)