Stock Market Today: Markets Rally Ahead of Key Inflation Report

Stocks kicked off a pivotal week on an upbeat note, boosted by some blue-chip mergers and acquisitions news and a buoyant reading on consumer expectations. 

Mostly, however, Monday was a "wait-and-see" session. After all, tomorrow's critical reading on inflation (opens in new tab) and an interest rate (opens in new tab) announcement from the Federal Reserve later this week are certain to shape where stocks go next.

The best Dow dividend stocks (opens in new tab) never go out of style, and on Monday two of them contributed to a big day for M&A news. Amgen (AMGN (opens in new tab)), which deserves a place in just about any portfolio of top biotech stocks (opens in new tab), struck an agreement to buy Horizon Therapeutics (HZNP (opens in new tab)) for $28.3 billion, including debt. The biggest healthcare deal of 2022 gives Amgen control of Horizon’s treatments for rare autoimmune and inflammatory diseases, including Tepezza, a blockbuster drug for thyroid eye disease.

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Meanwhile, Dow stock Microsoft (MSFT (opens in new tab)), which routinely ranks as a top stock pick for billionaires (opens in new tab) and hedge funds alike, struck a 10-year partnership deal with London Stock Exchange Group (LNSTY (opens in new tab)). The cloud-computing (opens in new tab) giant, which acquired a 4% stake in the bourse operator, will provide LSE with next-generation infrastructure, data and analytics.

In economic news, a survey by the Federal Reserve Bank of New York (opens in new tab) showed that regular folks are feeling better about both the future path of inflation and income growth. Consumers' expectations for inflation over the next one, three and five years decreased smartly, the NY Fed reported. At the same time, expectations for income growth reached a series high.

At the end of the day, markets finished the session with broad-based gains. The blue-chip Dow Jones Industrial Average added 1.6% to finish at 34,004, while the broader S&P 500 rose 1.4% to close at 3,990. The tech-heavy Nasdaq Composite gained 1.3% to reach 11,143. 

November's Inflation Report: What to Expect

All eyes are on the last inflation (opens in new tab) report of 2022, slated for release before Tuesday's opening bell – and just a day before the Federal Reserve's final interest rate (opens in new tab) decision of the year.

A nasty upside surprise in CPI could complicate the central bank's calculus (opens in new tab), and even send stocks into a tizzy (opens in new tab). To get a sense of what the experts think about tomorrow's inflation report, have a look at what economists, strategists and other market pros have to say about the pending CPI print (opens in new tab).