Adobe Inc
Adobe Rises as Investors Rotate Into Software
Money is moving from heavily indebted AI-focused companies into enterprise software. Established tech services firms are benefiting, and concern that inflation and borrowing costs will linger could be strengthening the appeal of business models with long track records.
Thursday's inflation report added fuel to the rotation. Producer prices, as measured by the Bureau of Labor Statistics, rose 1.3% in September. Economists were looking for 0.5%. Over 12 months, producer prices were up 6.3%, compared with a 5.3% forecast, the steepest annual climb since December 2022. Stripping out food and energy, the monthly gain was 0.7% and the annual gain 5%.
A day earlier, the consumer price index surprised to the upside. Headline inflation hit 3.7% when economists expected 3.6%. Energy was the main engine of the producer price spike. Goods prices for final demand rose 2.6%, a record one-month gain for a series that began in December 2009, with energy responsible for over 80% of the move.
Adobe is a software company, which places it in the part of the market investors appear to prefer. AI infrastructure builders often rely on heavy borrowing to expand, while software growth typically does not hinge on financing a capital-intensive buildout.
If inflation and rates stay elevated, investors may lean toward established companies and away from those that depend on debt markets. That tilt could support further momentum in Adobe shares.
ADBE Shares Are Rising
ADBE Price Action: Adobe shares were up 3.90% at $250.06 at the time of publication on Thursday, according to Benzinga Pro.
