The good news on Thursday was that Taiwan Semiconductor () announced that its August sales rose 53.3% compared to the same month a year ago. TSM is a major supplier to Apple, Microsoft, and Nvidia, so its record sales in August are a good sign for many technology stocks as well as AI and data center-related stocks.
The August had a good headline, but poor details. The Labor Department announced that the Producer Price Index (PPI) rose 0.4% in August, which was in line with economists’ consensus estimate. The good news is the , excluding food and energy, rose only 0.2%, which was below economists’ consensus estimate of a 0.3% increase. The bad news was that the July core PPI was revised up to a 0.3% gain.
Unfortunately, wholesale goods prices rose 1.1% in August, while wholesale service costs rose only 0.1%. Wholesale food prices rose 0.1% in August, while energy prices soared 4.2%. Bloomberg reported that this energy shock did not include the recent surge in diesel prices, since the Labor Department only collected data through August 11th. Treasury yields rose in the wake of the PPI report, which will put more pressure on the Fed to raise key interest rates.
The Consumer Price Index () will be announced on September 11th. Economists are expecting that the CPI will rise 0.4% in August. The is expected to rise 0.2%. The European Central Bank () raised its key interest rates 0.25% on Thursday, and this key interest rate hike will put more pressure on the Fed to hike key interest rates, unless the CPI comes in well below economists’ consensus expectation.
Meanwhile, the annual Apple product announcement on September 9th was a blockbuster. Apple’s () first folding phone, the iPhone Duo, was officially announced and can be ordered on October 16th at a starting price of $1,999, but prices soar up to $3,199 as you add more memory. The primary reason that the iPhone Duo release cannot be ordered until October 16th is likely due to supply chain bottlenecks, so it will be interesting how long the wait for the iPhone Duo will be. The iPhone Duo is supposed to be in Apple stores on October 23rd.