NASDAQ, S&P 500, Dow Jones Analysis – Stocks Move Higher As Treasury Yields Fall After CPI Report

Key Insights

• Stocks are testing new highs after the release of the CPI data, which met analyst expectations. 
• Energy stocks continue to rebound as WTI oil managed to settle above the $79 level. 
• The earnings season begins tomorrow with reports from big banks, so traders should be prepared for volatility. 

S&P 500 (SPX500)

S&P 500 moved to new highs as traders reacted to the release of U.S. inflation data for December.

Inflation Rate decreased from 7.1% in November to 6.5% in December, while Core Inflation Rate declined from 6% to 5.7%. Both reports were in line with the analyst consensus.

S&P 500 found itself under pressure at the start of the trading session, but traders quickly bought the dip. Treasury yields moved to new lows, providing material support to stocks. The pullback of the U.S. dollar, which tested multi-month lows, has also served as a positive catalyst for S&P 500.

Traders bet that the Fed will not push rates above the 5.00% level in 2023 as its previous moves have already put material pressure on inflation.

Today’s move was led by energy stocks, which enjoyed strong support as WTI oil moved above the $78 level. Hess Corporation, APA Corporation, and EQT Corporation were the among the biggest gainers in the S&P 500.

NASDAQ (NAS100)

The tech-heavy NASDAQ also moved higher as lower Treasury yields are bullish for yield-sensitive tech stocks.

Meta and NVIDIA were up by 3% in today’s trading session, while Tesla  pulled back by 2%.

Currently, NASDAQ is trying to climb above the 11,500 level. In case this attempt is successful, NASDAQ will continue its rebound and move towards the resistance at 11,600.

Dow Jones (US30)

Dow Jones has also enjoyed strong support in today’s trading session. Disney, Boeing, and Caterpillar were the best performers in the Dow Jones.

Tomorrow, the earnings season begins with  reports from big banks, including Dow Jones component JPMorgan Chase. Traders should be prepared for fast moves.

For a look at all of today’s economic events, check out our economic calendar.