On Tuesday, US stocks closed strongly in positive territory, supported by a significant inflation report indicating predominantly stable prices just prior to the Federal Reserve’s conclusive policy meeting for 2023.
The Dow Jones Industrial Average (^DJI) marked an impressive closure, surging by approximately 0.5%, or more than 150 points. This result clinched its third-highest close in history, underlining the market’s positive momentum.
The broader market, as reflected by the S&P 500 (^GSPC), also experienced a commendable uptick of around 0.5%. Concurrently, contracts associated with the tech-heavy Nasdaq Composite (^IXIC) led the charge with a gain of approximately 0.6%. This surge came on the heels of all three major indices achieving their highest closing levels since early 2022 on Monday.
A pivotal factor in this market performance was the release of the Consumer Price Index (CPI) for November, indicating a marginal increase of 0.1% from the previous month and a 3.1% rise from the same period last year. As reported by Alexandra Canal of Yahoo Finance, these figures suggest a relatively steady pricing environment.
Investors are closely monitoring the Federal Reserve’s two-day meeting, which commenced on Tuesday, with widespread expectations of a pause in rate hikes. However, traders are gradually moderating their predictions for a rate cut in March, as indicated by data from CME FedWatch.
While consumer inflation is projected to remain unchanged for the second consecutive month, concerns loom over the “core” reading, excluding volatile food and energy prices. If this measure proves to be more persistent, it could prompt investors to reassess their expectations for the timing of potential rate reductions by the Federal Reserve.
In response to the inflation report, US bond yields exhibited a slight retreat, with 10-year Treasury yields (^TNX) decreasing by approximately 3 basis points, settling near 4.21%.
Shifting focus to individual stocks, Oracle (ORCL) found itself in the spotlight as its shares closed more than 12% lower. The decline followed disappointing second-quarter sales figures, falling short of market estimates. The software giant’s performance contributed to the dynamic nature of the market’s response to various corporate developments.
In a testament to market resilience and positive sentiment, US stocks closed strongly, reflecting investor confidence and optimism. As the market remains attuned to the Federal Reserve’s decisions and global economic indicators, the trajectory of US stocks will likely continue to be influenced by a delicate balance of economic data, corporate performance, and monetary policy in the coming weeks.
Source: Yahoo Finance
