What's Going On With Carvana Stock Tuesday?

Carvana Co CVNA shares are trading higher by 7.72% to $143.78 during Tuesday’s session, riding a wave of broader market enthusiasm sparked by a softer-than-expected Producer Price Index (PPI) report.

The July PPI data, which showed only a 0.1% month-over-month increase—below the anticipated 0.2%—has intensified investor speculation that the Federal Reserve may implement a more aggressive interest rate cut in the coming month.

What Happened?

The annual increase in PPI came in at 2.2%, down from June's 2.7% and also lower than forecasts. This cooling in producer inflation suggests that the pricing pressures on businesses are easing, which could reduce the urgency for the Fed to maintain higher rates. The core PPI, which strips out food and energy, was flat month-over-month, further underscoring the slowdown in inflationary trends.

As hopes of a significant rate cut grew following the PPI report, Carvana's stock saw a lift, reflecting the company's sensitivity to interest rate changes. Lower borrowing costs could ease the financial burden on Carvana, which has been navigating a challenging environment marked by high debt and competitive pressures in the online used car market.

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A more substantial rate cut would also make auto financing more affordable for consumers, potentially driving higher sales and boosting Carvana's revenue prospects.

Investors now turn their focus to the upcoming Consumer Price Index (CPI) report, with hopes that a similar softening in consumer inflation could further bolster the case for a large rate cut.

How To Buy CVNA Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Carvana’s case, it is in the Consumer Discretionary sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

According to data from Benzinga Pro, CVNA has a 52-week high of $154.00 and a 52-week low of $25.09.