The stock markets surged midweek, with the S&P 500 making significant gains after positive inflation data and strong earnings reports from major banks. Here’s the latest stock market news from CNBC (Stock Markets Rally) and other sources, focusing on how the CPI today impacts the financial outlook.
CPI Today: Lower Inflation Boosts Stock Markets
The latest Consumer Price Index (CPI) report revealed that core inflation grew just 0.2% from November, bringing the annual rate down to 3.2%. This drop marks a much-needed improvement after months of steady inflation.
Experts see this as a good sign for investors. “Lower inflation is easing concerns that the Fed might increase interest rates again,” said Larry Tentarelli, Chief Technical Strategist at Blue Chip Daily.
S&P 500 Leads the Charge in Stock Markets Rally
The S&P 500 rose 1.83% on Wednesday, leading the stock markets higher alongside the Dow Jones, which gained 703 points (1.65%), and the tech-heavy Nasdaq, up 2.45%.This rally comes as investors gained confidence from the CPI report and better-than-expected quarterly earnings from banks. “Lower inflation and strong earnings are a perfect combination to boost the stock market,” Tentarelli added.
Bank Earnings Fuel Optimism in Stock Market News
Major banks posted impressive profits for the fourth quarter of 2024, providing a boost to the stock markets:
- Goldman Sachs: Reported $4.11 billion in profit, more than doubling its results from a year ago.
- Wells Fargo: Achieved a $5.1 billion profit, up from $3.4 billion in 2023.
- Citigroup: Turned a $1.8 billion loss last year into a $2.9 billion profit this quarter.
BlackRock, the world’s largest asset manager, also posted a strong quarter with profits rising 21%, bringing its assets under management to a record $11.55 trillion.
How the CPI Today and Treasury Yields Impact Stock Markets?
The bond market also responded to the CPI report, with 10-year Treasury yields edging lower. This was a welcome relief for investors, as rising yields often divert funds away from the stock markets.
“A drop in Treasury yields is a tailwind for the S&P 500 and other indexes, helping stocks recover,” Tentarelli noted.
Future of Stock Markets: CNBC Experts Weigh In
Looking ahead, CNBC experts predict that the stock markets will continue to benefit from easing inflation and strong corporate earnings. Jay Hatfield, CEO of Infrastructure Capital Advisors, shared his bullish outlook: “We expect a strong year for mergers, acquisitions, and AI-related IPOs, making investment banks our top picks for 2025.”