Image Source : Krish Capital Pty Ltd

Index Update

US Stocks Rally! S&P 500 surges 1.5%, Nasdaq jumps 1.7%, and Dow Jones soars 650 points as traders’ welcome latest inflation report! Headline inflation hits 2.9%, but core rate slows to 3.2% and monthly core rate moderates to 0.2%.

Market Movers

Solid bank earnings also boost sentiment: JPMorgan +0.4%, Wells Fargo +3%, Goldman Sachs +4.8%, BlackRock +2.5%, Citigroup +4%, and BNY Mellon +6.4%.

Commodities Roundup

Oil steadies near $82/bbl, driven by supply concerns and US inventory drops. Gold holds above $2,690/oz, fueled by easing US inflation and hopes of less restrictive Fed policy. Silver surges toward $31/oz, a one-month high, as softer US inflation supports rate cut bets. Markets eye geopolitical developments, including the Israel-Hamas ceasefire, and the impact of pro-inflationary policies proposed by President-elect Trump.

Macro Update

US 10-year Treasury yield drops to 4.66% as cooling inflation fuels hopes for Fed rate cuts! Core inflation slows to 3.2% YoY, with monthly reading easing to 0.2%. Markets now price in 37bps of Fed easing this year, with first rate cut fully priced in for July. Retail sales, manufacturing data, and jobless claims due out today! Traders cautious ahead of Trump's inauguration, citing inflationary policy plans.

Futures Update

US stock futures are pointing higher, continuing the surge from yesterday's rally! Dow futures up 61 points (+0.1%), S&P 500 +23 points (+0.4%), and Nasdaq 100 +123 points (+0.6%). The market got a boost from a cooler-than-expected core inflation reading & strong earnings from big US banks, raising optimism for potential Fed rate cuts in 2025

The S&P 500 index posted a bullish daily candle, closing up approximately 1.83%, reversing two days of muted price action. Notably, the index reclaimed key short-term support levels, surpassing both the 20-Day and 50-Day Exponential Moving Averages (EMAs) after five consecutive closes below these levels. This recovery suggests renewed bullish momentum as the index looks to build on recent gains. The 14-Day Relative Strength Index (RSI) showed a strong reversal from the 40 level, closing at 51.39, indicating that bullish pressure is beginning to outpace bearish sentiment. This shift follows the release of CPI inflation data and growing optimism regarding a potential Fed rate cut, both of which have provided tailwinds for the index. In the short-term, the 6,000 level will act as a psychological resistance, while the 5,927 and 5,918 levels are now considered crucial support zones. Despite these short-term hurdles, the overall market structure remains bullish. The index has surged roughly 19% since the August 5th lows, and the recent retracement appears healthy, suggesting that the next leg of the rally could be well-supported. Additionally, the price recently found support at the 0.236 Fibonacci retracement level, further reinforcing the bullish outlook. 

You Are a Few Steps Away From Gaining Smart Market Insights

Sign up/Login Now and Gain Access to Exciting Opportunities from Investor and Resource Space!