Stocks traded in a tight range in the lead up to this afternoon's policy announcement from the Federal Reserve as investors took in another mixed inflation reading. However, the main indexes took a decisive turn higher after the central bank, as expected, kept interest rates unchanged in its December meeting and gave an update on the number of rate cuts it expects in 2024.
Ahead of the mid-afternoon Fed news, data from the Bureau of Labor Statistics showed the November Producer Price Index (PPI), which measures what businesses are charging suppliers for goods, was unchanged on a month-to-month basis, and up 0.9% on an annual basis. The monthly figure was higher than the 0.4% decline seen in October, while the yearly number was slower than the 1.2% rise from the previous month.
Core PPI, which excludes volatile food and energy prices, matched October's 0.1% increase. Year-over-year, core PPI was up 2.5%, below what was seen the month prior.
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.
Fed keeps rates unchanged, but hints cuts are to come
Today's mixed inflation data echoes what was seen in Tuesday's Consumer Price Index (CPI) report for November. In today's press conference, Fed Chair Jerome Powell acknowledged that the recent improvement we've seen on inflation "is very good news." However, Powell admitted it remains above the central bank's 2% target and that "we need to see more progress."
Still, according to the Fed's Summary of Economic Projections (SEP), or the "dot plot," which summarizes what each member expects monetary policy to be going forward, most central bankers anticipate three quarter-point rate cuts in 2024.
"The stock market waited all year for the Federal Reserve to pivot and for Christmas it gave the market the present of a pivot," says Anthony Denier, CEO of Webull, a commission-free trading platform. By keeping the federal funds rates unchanged and forecasting cuts for next year, "the Fed took a step toward the market, rather than the market moving toward the Fed."
Pfizer spirals after giving gloomy 2024 guidance
In single-stock news, Tesla (TSLA) was down 3.7% at its intraday low after the electric vehicle maker said it is recalling 2 million cars over Autosteer control issues with its Autopilot advanced driver-assistance system. "There may be an increased risk of a collision" in circumstances where a driver is misusing features related to Autosteer, said the recall notice issued by the National Highway Traffic Safety Administration. Thanks to the afternoon Fed surge, though, TSLA stock ended the day up 1.0%
Elsewhere, Pfizer (PFE) plunged 6.7% after the pharmaceutical giant said it expects fiscal 2024 revenue to range between $58.5 billion and $61.5 billion. Earnings per share are forecast to land between $2.05 and $2.25. By comparison, analysts, on average, anticipate full-year earnings of $2.93 per share on $58.6 billion in sales. The blue chip stock closed today at $26.66 – its lowest level since October 2014.
As for the main indexes, the Dow Jones Industrial Average rose 1.4% to 37,090 – a new all-time closing high – the S&P 500 gained 1.4% to 4,707, and the Nasdaq Composite climbed 1.4% to 14,733.
Related content
- Amazon Pilot Tests A New Grocery Delivery Plan
- The Earnings Recession Is Over
- Kiplinger's Earnings Calendar for This Week
-
Dow Soars 600 Points as Trump Retreats: Stock Market TodayAnother up and down day ends on high notes for investors, traders, speculators and Greenland.
-
12 Tax Strategies Every Self-Employed Worker Needs in 2026Your Business Navigating the seas of self-employment can be rough. We've got answers to common questions so you can have smoother sailing.
-
7 Hybrid Adviser Services, ReviewedThese hybrid adviser services aim for a sweet spot that combines digital investing with a human touch.
-
Dow Soars 588 Points as Trump Retreats: Stock Market Today
Another up and down day ends on high notes for investors, traders, speculators and Greenland.
-
If You'd Put $1,000 Into UPS Stock 20 Years Ago, Here's What You'd Have TodayUnited Parcel Service stock has been a massive long-term laggard.
-
Dow Dives 870 Points on Overseas Affairs: Stock Market TodayFiscal policy in the Far East and foreign policy in the near west send markets all over the world into a selling frenzy.
-
Small Caps Can Only Lead Stocks So High: Stock Market TodayThe main U.S. equity indexes were down for the week, but small-cap stocks look as healthy as they ever have.
-
How the Stock Market Performed in the First Year of Trump's Second TermSix months after President Donald Trump's inauguration, take a look at how the stock market has performed.
-
Dow Adds 292 Points as Goldman, Nvidia Soar: Stock Market TodayTaiwan Semiconductor's strong earnings sparked a rally in tech stocks on Thursday, while Goldman Sachs' earnings boosted financials.
-
Stocks See First Back-to-Back Losses of 2026: Stock Market TodayRising geopolitical worries and a continued sell off in financial stocks kept pressure on the main indexes on Wednesday.
-
Visa Stamps the Dow's 398-Point Slide: Stock Market TodayIt's as clear as ever that President Donald Trump and his administration can't (or won't) keep their hands off financial markets.
