U.S. Inflation Eases, Nasdaq Gains 2.45%

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  • November 11, 2024

In a notable turn of events on January 15, U.Sstock markets saw a significant boost, driven largely by easing inflation expectationsThe three major indices closed in the green, with the Nasdaq Composite soaring more than 2%, marking the best day for these market benchmarks since November 6, 2024. This surge may reflect growing optimism from investors about the Federal Reserve's next moves as inflation data suggests a potential shift in monetary policy.

Data released by the U.SBureau of Labor Statistics indicated that the Consumer Price Index (CPI) for December 2024 rose by 2.9% year-on-year, aligning with expectationsThis figure represented a modest increase from the previous month's 2.7%. Economists have interpreted this CPI report as a sign that the Federal Reserve might consider introducing interest rate cuts as early as March 2025. These fiscal decisions will shape not only market performance but also determine consumer spending and broader economic growth.

One significant political development accompanying these economic indicators is the new president-elect's consideration of an executive order that could pause the sale or ban of TikTok for 60 to 90 days upon taking office

As a popular platform with more than 14 million followers, it remains a primary communication tool that influences younger demographics.

On the same day, U.Smarkets exhibited bullish trends across the boardThe Dow Jones Industrial Average climbed 1.65% while the Nasdaq Composite and the S&P 500 followed suit with increases of 2.45% and 1.83%, respectivelyThis upward momentum was mirrored in the European markets, where indices such as the FTSE 100 in the UK, the CAC 40 in France, and the DAX in Germany also posted gains, each responding positively to the moderate inflation data.

Delving deeper into the specifics of the CPI report reveals that the unadjusted CPI also grew 0.4% month-on-month, exceeding an anticipated rise of 0.3%. Core CPI, which excludes volatile food and energy prices, experienced a 0.2% increase, aligning with expectationsInterestingly, year-on-year, the unadjusted core CPI came in at 3.2%, slightly below the anticipated 3.3% increase, signaling a mixed bag regarding inflation trends moving forward.

Financial analysts are closely monitoring these developments

Skyler Weinand, Chief Investment Officer of Regan Capital, articulated that the CPI data signals that the Federal Reserve may be on track to pursue rate cuts along the timeline predicted by many economistsIndeed, traders are pricing in a 97.3% probability that the Fed will maintain rates during its January meeting, with a mere 2.7% likelihood of a 25 basis point cut.

The momentum in the tech sector did not go unnoticed, with the Wind U.STech Giants Index rising by 3.16%, translating to an astounding nightly increase in market capitalization of about $557.6 billion across seven major tech companiesNotable outliers included Tesla, which surged by 8.04%, and Meta, with a rise of 3.85%. Other key players such as Nvidia, Alphabet (Google), and Amazon also experienced substantial gainsThis resurgence in tech stocks contributes positively to overall market health, with investors recognizing the sector's resilience and capacity for growth.

Additionally, market participants welcomed the onset of earnings season

Major financial institutions including JPMorgan Chase, Goldman Sachs, Wells Fargo, Citigroup, and BlackRock reported quarterly results exceeding market expectations, contributing to further stock price increases for these entitiesInvestors reacted positively, with JPMorgan's shares climbing nearly 2% and others like Goldman Sachs and Citigroup enjoying rises exceeding 6%.

As for Chinese stocks listed in the U.S., they followed a similar upward path, with the Nasdaq Golden Dragon Index up by 0.97%. Individual stocks like Douyin and NetEase saw substantial gains, while others, including Baidu and Li Auto, faced slight declinesThe fluctuations in Chinese stocks reflect broader market sentiments, influenced by geopolitical factors and China's own economic narratives.

A highlight of the day was SAFE&GREEN's flourishing performance, with shares skyrocketing by 74.98% amid exceptionally high trading volume, even triggering circuit breakers twice during the trading session

alefox

The company announced a binding letter of intent to acquire 100% of the securities of New Asia Holdings, signifying a strategic move that could elevate its market positionThe underlying assets of New Asia Holdings include Olenox Corp., an energy diversification company, and Machfu.com, focusing on industrial IoT solutions, aligning with the trend toward technological integration in energy management.

In commodity markets, bullion also saw promising developments, with spot gold prices increasing by 0.72% to $2,696.14 per ounce and contract gold up by 1.39%. Silver followed suit with gains exceeding 2%, reflecting a general trend of investors seeking safety in precious metals amid fluctuating market conditions.

Furthermore, crude oil prices surged due to rising global demand and supply concernsBrent crude increased by 3.13%, while WTI crude rose by 3.54%. Analysts now speculate that WTI prices could reach or exceed $85 per barrel in the near term, illuminating the broader implications such price shifts hold for the global energy sector and associated industries.

In the metals market, LME copper, zinc, and aluminum reported price increases

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