Stock Market Today: Stocks Close Higher Ahead of December CPI Report
The main indexes gained ground as Wall Street awaits a critical inflation update.
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.
Sign up for Kiplinger’s Free E-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?
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.
-
Here's How Collectibles Are Taxed
Collectibles Gains on collectibles can be subject to a higher rate than for most other investments.
By Kelley R. Taylor Last updated
-
Why Adobe Stock Is Down After Its Earnings Beat
Adobe stock is lower Thursday despite the tech giant beating expectations for its fiscal 2024 fourth quarter. Here's what you need to know.
By Joey Solitro Published
-
Stock Market Today: Tech Stocks Rally as CPI Supports Lower Rates
An inline inflation report sealed the deal for a December rate cut and sent the tech sector soaring.
By Dan Burrows Published
-
Stock Market Today: Stocks Shrink From Highs as CPI Looms
The Nasdaq hit a new record early Tuesday but drifted lower into the closing bell.
By David Dittman Published
-
Stock Market Today: Markets Reflect Global Uncertainty
Exuberance fades as investors confront micro challenges and a murkier macro environment.
By David Dittman Published
-
Stock Market Today: Nasdaq Nabs New High After Jobs Data
The S&P 500 also closed at its highest level ever, while the Dow Jones Industrial Average was pressured by another down day for UnitedHealth stock.
By Karee Venema Published
-
Rebound in Jobs Growth Keeps Fed on Track: What the Experts Are Saying
Jobs Report No nasty surprises in the November payrolls data leaves a quarter-point cut in play.
By Dan Burrows Published
-
Stock Market Today: Stocks Pause Near Highs Ahead of Jobs Friday
Investors await a key data set with sentiment still broadly positive.
By David Dittman Published
-
Stock Market Today: Stocks Rally as Econ News Affirms Rate-Cut Bets
Some soft economic data was good news for rate cuts and risk assets.
By Dan Burrows Published
-
Stock Market Today: Stocks End Mixed Ahead of Powell
Political upheaval in South Korea kept investors on their toes Tuesday.
By Karee Venema Published