Stocks Fall on Weakness in Software and Credit Card Companies

Economic Outlook - St. Louis Fed President Alberto Musalem stated that the US economy is robust, expecting above-potential growth, and advised against an accommodative stance from the Fed [1] - The US December CPI remained unchanged from November at +2.7% year-over-year, while the core CPI also held steady at +2.6% year-over-year, which was below the expected +2.7% [1] Stock Market Performance - The S&P 500 Index closed down -0.19%, the Dow Jones Industrials Index down -0.80%, and the Nasdaq 100 Index down -0.18% on Tuesday [5] - Stocks experienced a brief rise due to easing inflation concerns, but ultimately retreated as software stocks sold off following the release of a new AI tool by Anthropic [3][4] Sector Movements - Energy-producing stocks increased as WTI crude oil rose over +2% to a 2.25-month high, influenced by geopolitical risks and US tariffs on goods from countries doing business with Iran [3] - Software stocks faced declines, with Salesforce down more than -7%, Adobe down more than -5%, and Intuit down more than -4% after the AI tool announcement [12] Earnings and Forecasts - Q4 earnings season is beginning, with S&P earnings growth expected to rise by +8.4%, and +4.6% excluding the Magnificent Seven technology stocks [7] - Cardinal Health raised its full-year adjusted EPS forecast to at least $10.00, exceeding the previous forecast of $9.65-$9.85 [19] International Markets - Overseas stock markets showed mixed results, with the Euro Stoxx 50 up +0.22%, China's Shanghai Composite down -0.64%, and Japan's Nikkei Stock 225 up +3.10% [8]