Investors are bracing for the December CPI report due on Thursday
Global stock indexes rose and U.S. Treasury yields inched up on Wednesday as investors looked ahead to a U.S. consumer price report for possible clues on when the Fed could begin cutting interest rates.
Bitcoin slid, being whipsawed late on Tuesday after a social media message on the U.S. SEC’s account claimed the regulator had approved bitcoin ETFs but was later revealed to have been made by an unauthorised person.
Bitcoin was last down marginally at $45,563. The Securities and Exchange Commission is expected to decide later in the day whether to approve an application from asset managers Ark Investments and 21Shares to launch a spot bitcoin exchange traded fund.
Investors are bracing for the December CPI report due on Thursday. It is expected to show that headline inflation gained 0.2% in the month and by 3.2% on an annual basis.
There is still speculation about when the Fed may cut rates. I take them for their word – higher for longer. But it will be data dependent, and if inflation comes down more than the Fed wants, that is going to be the next issue, said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder.
Investors are also anxious to see U.S. company quarterly results, which begin with reports from some of the big U.S. banks on Friday.
The Dow Jones Industrial Average gained 197.64 points, or 0.53%, to 37,722.8, the S&P 500 added 32.01 points, or 0.67%, to 4,788.51 and the Nasdaq Composite advanced 131.91 points, or 0.89%, to 14,989.62.
The pan-European STOXX 600 index shed 0.18% and MSCI’s gauge of stocks across the globe advanced 0.46%.
Earlier, Japan’s Nikkei – which had its best year in a decade in 2023 – jumped 2% to break above 34,000 for the first time since 1990. Exporters led the charge, helped by a weakening yen after data showed Japanese real wages declined for a 20th month in November.
U.S. and European markets soared at the end of 2023 as inflation dropped more quickly than expected and central banks struck a softer tone, encouraging investors to bet on big rate cuts this year.
Benchmark 10-year yields slipped after a 10-year note auction. They were last up at 4.037%.
