The stock market endured some midday turbulence, but closed solidly higher in the wake of the November consumer price index.
The Dow Jones Industrial Average rose 67 points, or 0.1%. The S&P 500 was up 0.8%. The Nasdaq Composite was up 1.4%. The S&P and Dow each snapped four-day losing streaks.
The S&P slid on multiple occasions, but the index managed to hold onto a solid portion of its gains in the end. The Dow also turned lower around noon ET before closing higher.
The consumer price index for November rose at a 2.7% annual rate, while the core CPI marked a 2.6% annual uptick. That represented a surprise slowdown in inflation, though the government shutdown’s impact on data collection made the release noisier than usual.
“We expect that the December CPI report–released mid-January–will be more helpful for understanding fundamental trends,” wrote Mike Reid, RBC Capital Markets senior U.S. economist. “While this morning’s print was an early holiday gift for Fed Doves–we caution against putting too much weight in the report given the data collection challenges that impacted both October and November.”
Odds of a January rate cut perked up to 26.6%, compared to 24.4% on Wednesday. The yield on the 2-year Treasury note declined to 3.46%, while the 10-year yield was down to 4.12%.
Semiconductors and other stocks linked to the artificial intelligence trade also rallied in the wake of earnings last night from Micron Technology. The stocks slipped on Wednesday amid ongoing worries about valuations and spending.
“What a difference a day makes,” wrote Mizuho’s Daniel O’Regan. “All it took were historic numbers from MU and a benign CPI print to get things moving. We are seeing broad-based demand across AI, Tech and Momentum themes.”