Stock Market Today: Stocks Close Higher Ahead of CPI
Technology and communication services stocks outperformed in a strong session for the major benchmarks.
Stocks closed higher Monday ahead of a busy week on Wall Street.
A bare economic calendar allowed traders to turn their attention to tomorrow morning's inflation update, with the Labor Department set to unveil the next CPI report report ahead of the opening bell. And while today's buying was fairly broad-based, several Big Tech stocks enjoyed an outsized lift on reports that Facebook parent Meta Platforms (META) is planning to pass out more pink slips.
"All eyes are laser-focused on Tuesday's CPI report to gauge the market's likely flight course for the balance of Q1 and beyond," says Greg Bassuk, CEO at asset management firm AXS Investments. "Tuesday's CPI report, if fierier than expected, could jolt investors and the equity markets, which have been on a growth tear in 2023, sparked by hopes of declining inflation and a more dovish Fed policy on interest rates. A reverse course from the recent months of disinflation would reignite investor concerns that high inflation and Fed rate hikes will define the markets in 2023 as they did last year."
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
As for tomorrow's report, economists surveyed by Dow Jones expect headline inflation to increase 0.4% on a monthly basis, and by 6.2% year-over-year.
In single-stock news, Meta shares jumped 3.0% after the Financial Times said the company has delayed putting together some team budgets because it's planning another round of layoffs next month. This next batch of potential pink slips – which would add to the 11,000 issued in November – are part of CEO Mark Zuckerberg's call to make 2023 Meta's "Year of Efficiency."
The outsized gain in Meta stock helped the broader technology (+1.8%) and communication services (+1.5%) sectors outperform today, as well. As for the broader indexes, the Nasdaq Composite jumped 1.5% to 11,891, the S&P 500 rose 1.2% to 4,137, and the Dow Jones Industrial Average gained 1.1% to 34,245.
The best growth stocks to buy
Today's strong showing by the Nasdaq highlights the rising appetite for riskier stocks that investors have shown so far in 2023. The tech-heavy index is up 13.6% for the year-to-date, compared to a 7.8% gain for the broader S&P 500 and a 3.3% return for the blue-chip Dow.
Part of this is likely due to signs that the economic slowdown many are anticipating might not be as bad as initially expected. Indeed, the January jobs report came in surprisingly strong, while the Q4 GDP reading showed the U.S. economy grew at a faster-than-expected pace in the final quarter of 2022. "A soft landing is quickly replacing the 2023 recession forecast as the base case scenario," says Steven Ricchiuto, U.S. chief economist at Mizuho Securities. "This more constructive macro outlook and the general belief the Fed is searching for any excuse to reverse the direction of monetary policy has helped promote the 'risk on' trade that has dominated since the beginning of the year."
This is certainly good news for investors seeking out the best growth stocks, including the top AI stocks and best tech stocks to buy. And given the sharp declines these stocks succumbed to last year, many can still be bought at bargain valuations.
-
Timeless Trips for Solo TravelersHow to find a getaway that suits your style.
-
A Top Vanguard ETF Pick Outperforms on International StrengthA weakening dollar and lower interest rates lifted international stocks, which was good news for one of our favorite exchange-traded funds.
-
Is There Such a Thing As a Safe Stock? 17 Safe-Enough IdeasNo stock is completely safe, but we can make educated guesses about which ones are likely to provide smooth sailing.
-
If You'd Put $1,000 Into Caterpillar Stock 20 Years Ago, Here's What You'd Have TodayCaterpillar stock has been a remarkably resilient market beater for a very long time.
-
Dow Absorbs Disruptions, Adds 370 Points: Stock Market TodayInvestors, traders and speculators will hear from President Donald Trump tonight, and then they'll listen to Nvidia CEO Jensen Huang tomorrow.
-
AI Unwind Takes 2% Off the Nasdaq: Stock Market TodayMarkets are paying more and more attention to hyperscalers' plans to spend more and more money on artificial intelligence.
-
Big Change Coming to the Federal ReserveThe Lette A new chairman of the Federal Reserve has been named. What will this mean for the economy?
-
Job Growth Sizzled to Start the Year. Here's Why It's Unlikely to Impact Interest RatesThe January jobs report came in much stronger than expected and the unemployment rate ticked lower to start 2026, easing worries about a slowing labor market.
-
I'm a 55-Year-Old Dad. Here’s How My 28-Year-Old Daughter Showed Me That AXP Is Still a Solid InvestmentAmerican Express stock is still a solid investment because management understands the value of its brand and is building a wide moat around it.
-
Why the Next Fed Chair Decision May Be the Most Consequential in DecadesKevin Warsh, Trump's Federal Reserve chair nominee, faces a delicate balancing act, both political and economic.
-
The New Fed Chair Was Announced: What You Need to KnowPresident Donald Trump announced Kevin Warsh as his selection for the next chair of the Federal Reserve, who will replace Jerome Powell.
