Market Turbulence: Mixed U.S. Stock Indices, ECB Rate Cut, and Hurricane Francine Impacts

Major U.S. stock indices exhibited mixed performance following a European Central Bank rate cut. Oil prices surged due to Hurricane Francine's impact on U.S. output. The ECB announced a rate cut citing slow growth and inflation, while U.S. data suggested potential Federal Reserve rate cuts. The dollar slid, and oil and gold saw significant gains.

Major U.S. stock indices opened Thursday mixed following a European Central Bank rate cut and oil prices surged over 1%, raising concerns that Hurricane Francine could affect U.S. output.

In early trading, the Dow Jones Industrial Average was down 0.45%, the S&P 500 dropped 0.22%, and the Nasdaq Composite rose slightly at 0.02%. Globally, MSCI's gauge of stocks increased by 0.48%.

Earlier Thursday, the ECB announced its second rate cut of the current cycle due to slowing inflation and economic growth. This move was anticipated by the market, though the ECB offered little clarity on future actions. "Policymakers again pledged a data-dependent, meeting-by-meeting approach to future rate decisions," said Michael Brown, senior research strategist at Pepperstone.

U.S. core consumer price index data showed a 0.28% rise in August, exceeding forecasts of 0.2%. This was followed by data revealing a 0.2% increase in U.S. producer prices in August, signaling slowing inflation and clearing the path for potential Federal Reserve rate cuts. "The inflation pipeline continues to clear, giving policy makers ample opportunity to shift focus," stated Jeffrey Roach, chief economist for LPL Financial.

The dollar slid against major currencies, with the dollar index falling 0.21% and the euro up 0.25%. Oil prices were up about 1%, driven by concerns over Hurricane Francine's impact on U.S. Gulf of Mexico output. Analysts at UBS estimated the disruption could reduce September production by 50,000 barrels per day.

Industrial metals like copper saw significant gains, whereas gold surged 1.37% to $2,545 an ounce. (Additional reporting by Stella Qiu in Sydney; Editing by Alison Williams and David Evans)

(With inputs from agencies.)