Stock Market Today: Stocks Close Flat After Mixed Inflation Data
Stocks closed well off their session highs after data showed headline inflation accelerated in December.
Stocks opened higher following this morning's release of the December Consumer Price Index (CPI). However, this initial burst of buying power faded throughout the session as market participants mulled over the mixed report.
Ahead of the opening bell, the Bureau of Labor Statistics said headline inflation was up 0.3% month-over-month in December and 3.4% higher year-over-year. Both figures are higher than what was seen in the November CPI and the annual increase was the largest in three months.
On the other hand, core inflation, which excludes volatile food and energy prices, was up 0.3% on a monthly basis, matching November's figure. Annually, core CPI was 3.9% higher, the smallest year-over-year increase since May 2021.
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.
"The big picture is that the economic dislocations caused by the pandemic are fading, economic growth is settling into a more normal pace, and labor shortages are much less of an issue, helping bring inflation back to normal," says Bill Adams, chief economist for Comerica Bank. "Slower trend inflation is clearing a path for the Fed to begin lowering U.S. interest rates," Adams adds, which has financial markets expecting rate cuts as soon as March.
Indeed, even with today's hot December CPI reading – and a Bloomberg interview with Cleveland Fed President Loretta Mester where she said March is "probably too early" for rate cuts – market participants refuse to budge from their dovish outlook. According to CME Group's FedWatch Tool, futures traders are pricing in a 68% chance for a quarter-point rate cut at the Fed's March meeting, up from 62% one week ago.
"Given financial market pricing, risks are skewed toward an earlier and faster reduction in interest rates," Comerica's Adams says.
Bitcoin fades after initial pop
Elsewhere, Bitcoin jumped to a nearly two-year high above $49,000 earlier after the Securities and Exchange Commission (SEC) last night approved spot bitcoin ETFs. However, the digital currency was hovering closer to $46,300 when the stock market closed.
A similar reversal was seen in several crypto-related stocks, including Coinbase Global (COIN, -6.7%), Robinhood Markets (HOOD, -3.5%) and Marathon Digital Holdings (MARA, -12.6%).
Paramount stock slumps after new Sell rating
Paramount Global (PARA) was another stock falling sharply Thursday. Shares slid 5.5% after Redburn Atlantic analyst Hamilton Faber downgraded PARA – a member of Warren Buffett's Berkshire Hathaway equity portfolio – to Sell from Hold, citing a "negative tipping point" in linear advertising that is not adequately reflected in analysts' forecasts.
Faber downgraded Warner Bros. Discovery (WBD, -3.9%) to Hold from Buy for the same reason.
As for the main indexes, the Nasdaq Composite eked out a marginal gain at 14,970, the S&P 500 slipped 0.07% to 4,780, and the Dow Jones Industrial Average ticked 0.04% higher at 37,711.
Related content
- Is a Controversial Capital Gains Tax Headed for Repeal?
- Boeing Max 9: What To Know About Alaska's Flight Cancellations
- Your Spectrum Cable Box Is About To Get More Expensive
-
Stocks Struggle for Gains to Start 2026: Stock Market TodayIt's not quite the end of the world as we know it, but Warren Buffett is no longer the CEO of Berkshire Hathaway.
-
Tip: Ways to Track Your Credit Card RewardsHere are the best strategies and apps to help you stay current with your credit card rewards.
-
How New Investors Can Pick Their Perfect Portfolio, According to a ProSee what Cullen Roche has to say about finding your perfect portfolio as a new investor and his two-word answer on where he thinks the stock market is headed in 2026.
-
Stocks Struggle for Gains to Start 2026: Stock Market Today
It's not quite the end of the world as we know it, but Warren Buffett is no longer the CEO of Berkshire Hathaway.
-
If You'd Put $1,000 Into Lowe's Stock 20 Years Ago, Here's What You'd Have TodayLowe's stock has delivered disappointing returns recently, but it's been a great holding for truly patient investors.
-
Stocks End Volatile Year on a Down Note: Stock Market TodayAfter nearing bear-market territory in the spring, the main market indexes closed out the year with impressive gains.
-
Stocks Extend Losing Streak After Fed Minutes: Stock Market TodayThe Santa Claus Rally is officially at risk after the S&P 500's third straight loss.
-
If You'd Put $1,000 Into 3M Stock 20 Years Ago, Here's What You'd Have TodayMMM stock has been a pit of despair for truly long-term shareholders.
-
Santa Claus Rally at Risk as Tech Stocks Slump: Stock Market TodayThe Nasdaq Composite and Dow Jones Industrial Average led today's declines as investors took profits on high-flying tech stocks.
-
These Were the Hottest S&P 500 Stocks of the YearAI winners lead the list of the S&P 500's top 25 stocks of 2025, but some of the names might surprise you.
-
Gold and Silver Shine as Stocks Chop: Stock Market TodayStocks struggled in Friday's low-volume session, but the losses weren't enough to put the Santa Claus Rally at risk.
