What Happened?
A number of stocks fell in the morning session after an unexpectedly sharp rise in wholesale inflation fueled concerns about rising costs and their impact on corporate profits. The primary catalyst was the July 2025 Producer Price Index (PPI), a measure of inflation at the wholesale level, which jumped 0.9% against forecasts of a 0.2% rise. This represents the most significant monthly increase in over three years, pointing to mounting cost pressures for manufacturers, with tariffs cited as a key factor. This data complicates the Federal Reserve's upcoming interest rate decisions, as persistent inflation may prevent rate cuts, creating a headwind for cyclical sectors like Industrials.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Energy Products and Services company Ameresco (NYSE: AMRC) fell 4.3%. Is now the time to buy Ameresco? Access our full analysis report here, it’s free.
- Waste Management company Perma-Fix (NASDAQ: PESI) fell 5.6%. Is now the time to buy Perma-Fix? Access our full analysis report here, it’s free.
- Electronic Components company Vishay Precision (NYSE: VPG) fell 3.7%. Is now the time to buy Vishay Precision? Access our full analysis report here, it’s free.
- Ground Transportation company RXO (NYSE: RXO) fell 3.9%. Is now the time to buy RXO? Access our full analysis report here, it’s free.
- Renewable Energy company Sunrun (NASDAQ: RUN) fell 4.6%. Is now the time to buy Sunrun? Access our full analysis report here, it’s free.
Zooming In On Perma-Fix (PESI)
Perma-Fix’s shares are extremely volatile and have had 32 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 28 days ago when the stock gained 3.1% on the news that the second quarter (2025) earnings season got off to a strong start.
Quarterly earnings reports released during the week exceeded Wall Street's expectations, fueling investor confidence. Around 50 S&P 500 components reported, with 88% of those exceeding analysts' expectations, FactSet data revealed. Investors were also encouraged by several positive reports that painted a picture of a resilient consumer. One key report revealed that shoppers increased their spending at U.S. retailers more than economists had anticipated. Precisely, retail sales increased 0.6% from May, surpassing the 0.2% estimate. This robust consumer spending is a crucial pillar supporting the economy.
Adding to the positive sentiment, the latest data on unemployment claims showed a decrease in the number of workers applying for benefits, signaling that layoffs remain limited and the job market is steady. This combination of strong earnings reports, retail sales, and a solid labor market suggests the economy is navigating challenges successfully.
Perma-Fix is up 9.8% since the beginning of the year, but at $11.80 per share, it is still trading 23.9% below its 52-week high of $15.50 from November 2024. Investors who bought $1,000 worth of Perma-Fix’s shares 5 years ago would now be looking at an investment worth $1,683.
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