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That May CPI data showed that inflation is finally starting to cool down. That’s good news for Nikola and other companies that went public via special purpose acquisition company (SPAC) mergers.
Rising inflation has been weighing on companies that went public via SPACs for a couple of reasons. That includes rising interest rates and costs. This matters more to these companies as many of them aren’t yet generating free cash flow and still require external financing to grow.
What investors are really hoping for is The Federal Reserve cutting interest rates. If the organization lowers rates as inflation slows, it could be a positive catalyst for NKLA and other prior SPAC stocks that need more money to expand, reports Barron’s.
Investors will also keep in mind that The Fed has been meeting yesterday and today to go over the May CPI data. That means traders could get an update on its interest rate plans later today
How This News Affects NKLA Stock Today
Shares of NKLA stock are seeing heavy trading alongside positive sentiment. This has some 38 million shares of the move as of this writing. For comparison, the company’s daily average trading volume is below that at about 32 million shares.
NKLA stock is up 14.8% as of Wednesday morning. However, the stock is still down 52.7% year-to-date.
Investors can learn more about all of the latest stock market news at the following links!
We’ve got all of the biggest stock market stories that traders need to know about on Wednesday! Among that is what’s going on with shares of Chinese stocks, as well as Lumen Technologies (NYSE:LUMN) and UnitedHealth (NYSE:UNH) stock today. All of that news is available at the links below!
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.