Stocks closed higher Wednesday as investor sentiment remained upbeat ahead of this week's key inflation report and the start of fourth-quarter earnings season.
The Street will get the final Consumer Price Index (CPI) figures for 2023 ahead of tomorrow's opening bell. Most economists expect the headline December CPI will be slightly higher on an annual basis vs November, while core CPI, which excludes volatile food and energy prices, will be slightly lower.
Markets rallied hard at the end of 2023 on expectations the Federal Reserve will start cutting interest rates as soon as its March meeting. "That is what makes tomorrow's CPI report all the more important, as the data now needs to fall in line with the very bullish expectations priced into the markets," says Craig Erlam, senior market analyst at OANDA.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
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.
On Friday, financial results from several big banks – including Bank of America (BAC, -0.1%) and JPMorgan Chase (JPM, +0.2%) – kickoff Q4 earnings season. While the earnings recession officially ended in Q3, analysts are growing increasingly worried about Q4. According to John Butters, senior earnings analyst at FactSet Research Systems, analysts cut their fourth-quarter earnings per share (EPS) estimates for the S&P 500 by 6.8% from September 30 to December 31. That's significantly greater than the five-year average of a 3.5% decline during the quarter.
Amazon stock pops on layoff news
In single-stock news, Amazon.com (AMZN) jumped 1.6% – gaining $25 billion in market capitalization – after the e-commerce giant said it's laying off several hundred employees in its Prime Video and MGM Studios divisions. Amazon is also cutting 500 jobs in its Twitch unit. The company has laid off roughly 27,000 employees since 2022.
Fellow Magnificent 7 stock Meta Platforms (META) also had a strong day on the price charts, adding 3.7%. Mizuho Securities analyst James Lee lifted his price target on META to $470 from $400. That's the highest target on the Street, according to S&P Global Market Intelligence.
In a note to clients, Lee, who has a Buy rating on Meta, writes that fiscal 2024 revenue estimates for the Facebook parent are "conservative." The analyst also thinks that "WhatsApp could incrementally increase Meta's revenue base by a third over time using AI to automate customer service."
Bitcoin trades lower ahead of SEC's spot bitcoin ETF ruling
Meanwhile, ahead of today's Securities and Exchange Commission (SEC) ruling on spot bitcoin ETFs (exchange-traded funds), Bitcoin traded just below the $46,000 price point.
The cryptocurrency spiked all the way up to $47,000 late Tuesday after a tweet on the SEC's X page suggested the regulatory agency approved a spot bitcoin ETF. However, the SEC immediately issued a follow-up tweet that indicated its X page was hacked and that the tweet was fake. The SEC's decision is expected after Wednesday's close.
As for the main indexes, the Nasdaq Composite finished up 0.8% at 14,969, the S&P 500 climbed 0.6% to 4,783 and the Dow Jones Industrial Average added 0.5% to 37,695.
Related content
- Is a Controversial Capital Gains Tax Headed for Repeal?
- Starbucks 2024 Deals: BOGO Weekends, $3 Drinks, Triple Stars
- What Does a Government Shutdown Mean for Stocks?
-
How to Choose the Best Charities to Donate ToWhile you set your giving strategy, think about your values, and select organizations that will put your contributions to good use.
-
I'm 62 and want to work a few more years, but all of this AI talk makes me feel like a dinosaur. Can't I just do my job without technology complicating things?We asked professional career coaches for advice.
-
Stocks Retreat as Bubble Worries Ramp Up: Stock Market TodayValuation concerns took hold on Wall Street today, sending Palantir and its fellow tech stocks lower.
-
Amazon Surge Sends S&P 500, Nasdaq Higher to Start November: Stock Market TodayAmazon inked a $38 billion cloud deal with OpenAI, which sent the stock to the top of the Dow Jones on Monday.
-
If You'd Put $1,000 Into Home Depot Stock 20 Years Ago, Here's What You'd Have TodayHome Depot stock has been a buy-and-hold banger for truly long-term investors.
-
3 Major Changes Investors Must Prepare for in 2026A possible stock market bubble. Trump accounts. Tokenized stocks. These are just three developments investors need to be aware of in the coming months.
-
Stocks Close Out Strong Month With Solid Amazon Earnings: Stock Market TodayAmazon lifted its spending forecast as its artificial intelligence (AI) initiatives create "a massive opportunity."
-
Stocks Sink with Meta, Microsoft: Stock Market TodayAlphabet was a bright light among the Magnificent 7 stocks today after the Google parent's quarterly revenue topped $100 billion for the first time.
-
Dow, S&P 500 Slip on December Rate Cut Worries, Nvidia Boosts Nasdaq: Stock Market TodayNvidia became the first company ever to boast a $5 trillion market cap, but it wasn't enough to lift the Dow and the S&P 500.
-
Stocks Hit Fresh Highs Ahead of the Fed As Earnings Pump Optimism: Stock Market TodaySHW and UNH were two of the best Dow Jones stocks Tuesday, thanks to solid earnings reports, and MSFT closed with a $4 trillion market cap.
