S&P 500 and Nasdaq: US Indices Mixed as Stock Market Weighs Earnings, CPI Data

Mixed Open Expected as Investors Weigh Inflation Data and Earnings

U.S. equity futures are mixed ahead of the cash market opening on Tuesday as investors digest the impact of the latest inflation reading on Fed policy. Adding to the early session hesitation is the first round of fourth-quarter earnings results.

At 14:48 GMT, the blue chip Dow Jones Industrial Average is trading 49296.12, down 294.08 or -0.59%. The benchmark S&P 500 Index is at 6974.06, down 3.21 or -0.05% and the technology-based Nasdaq Composite is trading 23775.741, up 41.837 or +0.18%.

CPI Report Comes in Below Expectations—Fed Pause Likely

Stock futures initially gained after the December consumer price index report revealed that core CPI, excluding food and energy, rose 0.2% on the month and 2.6% on the year. These figures were below the pre-market estimates of 0.3% and 2.8%, respectively. However, the monthly headline figure increased 0.3% in December, putting the annual rate at 2.7%. Nonetheless, both increases were forecast by economists polled by Dow Jones.

The impact on the Fed, following the reports, remains the same. The steady inflation combined with the somewhat weaker, yet stable jobs market, is likely to encourage the Fed to stand pat on interest rate cuts at their first meeting of the year on January 28-29.

Currently, Fed funds futures are pricing in two quarter-point cuts this year, starting in June, according to the CME FedWatch tool.

Earnings Season Kicks Off with JPMorgan Beat, Delta Disappointment

With the Fed rate cut situation pretty clear at this time, investors can now move on to corporate profits with the kickoff of earnings season earlier today. JPMorgan Chase led off with better-than-expected results in the December quarter, but the stock couldn’t find direction. Traders, however, drove Delta down 4% in the premarket on mixed results.

Later this week, Bank of America, Citigroup, and Morgan Stanley are due to report their results.

Defense, Tech, and Healthcare Stocks Rally on Positive Catalysts

Early morning gains are being spread across multiple sectors. Defense contractor L3Harris Technologies rallied 13% after the company said it would pursue an IPO of its missile solutions business in the second half of 2026 through a partnership with the U.S. Defense Department. Chip stocks Intel and AMD are higher after KeyBanc upgraded both names to overweight, saying they each have upside of more than 30%, on a memory supercycle and outsized data center demand. Health sciences company Revvity is stronger early in the session after it released better-than-expected preliminary results.

Technical Outlook: S&P 500 Futures Hit New Record High

Technically, March E-mini S&P 500 Index futures are in an uptrend, which was reaffirmed earlier today with the new record high at 7036.25. The uptrend is also being supported by a series of higher bottoms at 6950.00, 6935.25, and 6866.75, which is strong evidence that buyers are coming in on the dips. However, the recent choppiness shows they are also selling rallies, which may mean investors are concerned about valuations at current price levels.

One key indicator of strength is the uptrend line from the November bottom at 6583.00. It comes in today at 6941.00. Another major trend indicator is the 50-day moving average at 6888.50.

Market Outlook: Earnings Will Determine if Stocks Are Overvalued

Looking ahead, today’s CPI data is bullish per se because it did nothing to change the narrative for no Fed rate cut in January and perhaps two later in the year. Keeping rate-cut expectations intact is very supportive for risk appetite. The only question is: are stocks overpriced? But earnings results should be able to answer that.

More Information in our Economic Calendar.