Market Overview - U.S. stock markets are experiencing volatility as investors react to inflation data and the start of the fourth-quarter earnings season, with major indexes previously closing at record highs [1][5] - Premarket trading showed a mixed trend, with Nasdaq 100 futures down 0.2% to 0.3%, and S&P 500 and Dow Jones futures declining by 0.1% to 0.2% [2] - Following the release of the December Consumer Price Index (CPI), futures for major indexes reversed earlier declines, with Nasdaq 100, S&P 500, and Dow Jones futures rising by 0.2%, 0.2%, and 0.1% respectively [3] Commodities and Currency - Gold futures remained stable near record highs, while silver futures surged to an all-time high of $87.56 per ounce [4] - WTI crude oil futures increased by approximately 2% to $60.70 per barrel, influenced by geopolitical tensions and potential tariffs on countries doing business with Iran [4] - Bitcoin was trading around $92,000, and the U.S. dollar index rose by 0.1% to 98.92 [4] Earnings Reports - The fourth-quarter earnings season commenced, with JPMorgan Chase & Co. reporting a drop in profit due to a one-time charge, but excluding this charge, profits increased [8][13] - Delta Air Lines experienced a premarket decline of 4-5% after releasing profit forecasts that fell short of market expectations [13] - Other companies reporting include Bank of New York Mellon and Concentrix, with Delta's results particularly scrutinized for insights into the travel industry's health [8] Stock Movements - L3Harris Technologies shares surged by 11-12% after announcing plans to spin off its Missile Solutions business, supported by a $1 billion investment from the Defense Department [13] - Chipmakers Intel and AMD saw gains of 3.6% and 2.6% respectively, following an upgrade to "overweight" by KeyBanc due to strong data-center demand [13] - Alphabet's stock rose by 0.68% after achieving a $4 trillion market valuation, bolstered by news of Google Gemini enhancing Apple's Siri [13] Other Corporate News - Xpeng Inc. ADR shares dipped 2.63% despite plans to establish localized supply chain teams in Europe and ASEAN [13] - Travere Therapeutics saw a significant slump of 28% after an FDA request for clarification on its therapy's clinical benefits [13] - Synopsys shares fell 2.3% following a downgrade to "neutral" by Piper Sandler, citing growth headwinds [13] - Credit card companies stabilized in premarket trading after experiencing declines due to proposed caps on interest rates [13] - Walmart gained on news of its inclusion in the Nasdaq 100 index [13]

Economic Indicators - The U.S. consumer price index increased by 0.3 percent in December, aligning with economist expectations [2][31] - Core consumer prices, excluding food and energy, rose by 0.2 percent in December, slightly below the expected 0.3 percent increase [2][31] - The annual growth rate of consumer prices remained unchanged at 2.7 percent in December, consistent with November's rate [2][32] - The annual growth rate of core consumer prices also held steady at 2.6 percent, while an increase to 2.7 percent was anticipated by economists [3][32] Stock Market Performance - Major U.S. stock indices are projected to open slightly higher, following a recovery from an initial pullback [1] - The Dow Jones rose by 86.13 points (0.2 percent) to close at 49,590.29, while the Nasdaq increased by 62.56 points (0.3 percent) to 23,733.90, and the S&P 500 climbed by 10.99 points (0.2 percent) to 6,977.27 [5] - The NYSE Arca Computer Hardware Index surged by 5.0 percent, indicating strong performance in the computer hardware sector [10] Federal Reserve and Interest Rates - The Federal Reserve is expected to maintain interest rates at its upcoming meeting, with potential cuts of at least a quarter point anticipated in the following months [10] - Concerns regarding the Federal Reserve's independence have arisen due to subpoenas served by the Department of Justice related to Fed Chair Jerome Powell's testimony [6][7] - Powell described the subpoenas as "unprecedented," attributing them to pressure from President Trump regarding interest rate policies [8] Commodity Markets - Crude oil futures increased by $1.15 to $60.65 per barrel, while gold futures rose by $8.10 to $4,622.80 per ounce [12]

Group 1 - The latest inflation update has not significantly changed the expectations for a January interest-rate cut, with traders now estimating a 5% chance of a cut on January 28, up from 4.4% earlier in the week [1] - The likelihood of at least one quarter-point cut by March has increased slightly to 29% from 28.7% [2] - The probability of a quarter-point cut through June has risen to 47.2% from 46.2%, while the odds for a half-point cut have increased to 21.6% from 19% [2] - The chances of a three-quarters of a point cut through June have also grown to 3.4% from 2.7% [2]

Core Insights - U.S. consumer prices increased by 2.7% in December year-over-year, aligning with forecasts, marking a year of gradually easing but uneven inflation across the economy [1] - The December Consumer Price Index (CPI) report indicates a 0.3% rise in consumer prices from November to December, driven primarily by shelter and food costs [2] Inflation Trends - Core inflation, which excludes food and energy prices, remained stable at 2.6% in December, consistent with the previous month [3] - Consumers expect near-term inflation to rise to 3.4%, reflecting concerns about financial conditions across different income groups [4] Federal Reserve Implications - The December CPI report will influence the Federal Reserve's interest rate decision at the end of January, with inflation still above the Fed's 2% target [5] - A decline in the unemployment rate from November to December has reduced expectations for another cut to the Fed's benchmark interest rate, with forecasts suggesting the rate will remain between 3.5% and 3.75% [6]

Core Insights - Core U.S. consumer prices rose less than expected in December, indicating a potential easing of inflation as the Federal Reserve considers its next interest rate decision [1] - The consumer price index (CPI) excluding food and energy showed a monthly increase of 0.2% and an annual increase of 2.6%, both 0.1 percentage points below expectations, suggesting that core inflation may be stabilizing [2] - The overall CPI increased by 0.3% for the month, aligning with the Dow Jones consensus estimate, while the annual rate stood at 2.7%, indicating that inflation is moving closer to the Fed's 2% target but remains elevated [3] Detailed Breakdown - Shelter, a significant component of the CPI, rose by 0.4% monthly and 3.2% annually, contributing notably to the overall inflation figures [4] - Food prices increased by 0.7% for the month, with notable rises in recreation, airfares, and medical care, while some tariff-sensitive categories also saw price increases [5] - The recreation category experienced a record monthly gain of 1.2%, the largest since data collection began in 1993, highlighting significant inflationary pressures in certain sectors [5]

Core Insights - Consumer prices increased by 2.7% in December compared to the same month last year, remaining unchanged from the rate in November [1] Group 1 - The Labor Department reported a year-over-year consumer price increase of 2.7% for December [1]

The US Bureau of Labor Statistics (BLS) released the CPI data for December, showing that inflation rose at an annual rate of 2.7%. However, the core CPI was the main catch on Tuesday, as it is the Fed’s preferred gauge. Bitcoin reacted, albeit mildly, while the silver price ascended to a new peak. Still, some analysts question the impact of macroeconomic data on market prices. Inflation Rose at an Annual Rate of 2.7% in December, US CPI Data Shows The latest CPI (Consumer Price Index) report shows infl ...

Core Inflation Insights - Core consumer prices rose 0.2% month-over-month and 2.6% year-over-year in December, marking the slowest annual rate since March 2021 [1][2] - The 2.6% increase in core CPI matches the rise reported in November, indicating a consistent trend in inflation moderation [2] Headline Inflation Data - Headline consumer prices increased by 0.3% over the previous month and 2.7% over the prior year, aligning with economists' expectations [2] - The Federal Reserve's target inflation rate remains at 2%, with current inflation still above this target [3] Economic Context - The December jobs report indicated a decrease in the unemployment rate, reinforcing expectations that the Federal Reserve will maintain current interest rates in its upcoming meeting [4] - Market data suggests a 95% probability that the Federal Reserve will keep rates unchanged following the January meeting [4] Food Price Dynamics - The index for food rose 0.7% in December, indicating notable inflation pressures on household food budgets, outpacing overall price increases [5] - Five out of six major grocery store food groups experienced price increases in December, with only the cost of meat declining by 0.2% [6] Transportation Costs - A significant factor in the moderation of core consumer prices was a 1.7% drop in the price of used cars and trucks, along with a 0.5% decrease in airline fares and overall transportation services [7]

Core Insights - Inflation eased in December, with core consumer prices rising at the slowest annual rate since March 2021, at 2.6% year-over-year [1][2] - The overall Consumer Price Index (CPI) increased by 0.3% month-over-month and 2.7% year-over-year, aligning with economists' expectations [2] Inflation Trends - Core CPI's 2.6% increase matches November's rate, indicating persistent inflation above the Federal Reserve's 2% target, although it has been declining over the past year [2][3] - The inflationary pressures on household food budgets remain significant, with food prices rising 0.7% in December, outpacing overall price increases [6] Sector-Specific Changes - The price of used cars and trucks decreased by 1.7% in December, contributing to lower core consumer prices [8] - Airline fares fell by 0.5%, and the overall transportation services category also saw a 0.5% price drop [8] - Energy costs contributed to the rise in headline prices, with gas prices falling by 5.3% in December, leading to a 2% decrease in the energy index from the prior month [8] Market Reactions - Following the December CPI report, market data indicated a 95% probability that the Federal Reserve would keep interest rates unchanged during its upcoming meeting [4]

Core Viewpoint - The article emphasizes that if the White House undermines public confidence in the Federal Reserve's commitment or capability to maintain low and stable inflation, it could lead to unpredictable economic consequences [1] Group 1 - The potential erosion of trust in the Federal Reserve is highlighted as a critical issue for economic stability [1] - The relationship between government actions and public perception of the Federal Reserve's effectiveness is underscored [1] - The implications of diminished trust could affect market behavior and economic forecasts [1]