Traders work on the floor of the New York Stock Exchange on January 15, 2025 in New York City.
David de Delgado | Getty Images
This report is from today's CNBC Daily Open, the international markets newsletter. CNBC Daily Open keeps investors informed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Core CPI is below estimates
The US Consumer Price Index rose at a seasonally adjusted rate 0.4% per month In December, the 12-month inflation rate was put at 2.9%, according to the US Bureau of Labor Statistics I mentioned Wednesday. Core inflation, which excludes food and energy prices, rose by 0.2% on a monthly basis and 3.2% on a yearly basis. The annual reading fell 0.1 percentage points from November. Both core readings were also 0.1 percentage point below expectations.
Ceasefire agreement between Israel and Hamas
Israel and Hamas on Wednesday Reaching a ceasefire agreement and releasing the hostages To finish a 15-month war In the Gaza Strip. The Israeli security cabinet must still vote on the agreement before it is implemented. US President Joe Biden said that the first phase of the agreement, if approved, would include a complete ceasefire and the withdrawal of Israeli forces from populated areas in the Gaza Strip.
Markets are having their best day in months
US stocks Popped in on Wednesday On their best day since November, on the back of a cooler-than-expected inflation reading and Treasury yields decline. Pan-European Stoxx 600 index He added 1.33% It broke a three-day losing streak He recorded his best performance since August. UK government bond yields decreased sharply After the official data showed UK inflation fell to 2.5% In December.
JPMorgan Chase releases previous earnings estimates
JPMorgan Chase Post a Huge earnings beat the fourth quarter. The bank's profits rose by 50% to $14 billion during that period, and revenues rose by 10% to $43.74 billion. That's thanks to net interest income of $23.47 billion, which beat StreetAccount estimates by about $400 million. JPMorgan executives said the bank would be Enhancing share buybacks Even when CEO Jamie Dimon in May called the stock too expensive.
Goldman Sachs nearly doubles its profits
Goldman Sachs Fourth quarter earnings Estimates for trading revenue were stronger than expected. The bank said profits nearly doubled from the previous year to $4.11 billion and revenue jumped 23% to $13.87 billion. “He was there A major shift in CEO confidence“Especially after the results of the US elections,” CEO David Solomon said on a conference call on Wednesday.
(PRO) Earnings should be cautious about next week
Nearly 7% of companies in Standard & Poor's 500 The index is scheduled to announce its earnings next week. CNBC Pro examined companies reporting earnings next week, looking for ones that analysts are increasingly bearish on, and found six companies that reported profits Earnings estimates have been revised downward During the past three months.
Bottom line
Finally, there is a string of good news for the bulls, after a poor start to the year during which markets recorded weekly losses due to persistent inflation fears.
Top of page: US inflation in December was lower than expected. Sure enough, this month's headline inflation rate was 0.1 percentage point higher than the Dow Jones estimate.
But the US Federal Reserve pays more attention to core inflation because it excludes volatile fluctuations in energy and food prices, which gives a more accurate reflection of price changes in the economy. Core inflation, both on a monthly and annual basis, was cooler than expected.
In fact, as CNBC's Jeff Cox said male“Much of the upward movement in the CPI came from a 2.6% increase in energy prices for the month, driven by a 4.4% rise in gasoline. That was responsible for about 40% of the index's gain, according to the BLS.”
“Today’s CPI number eliminates additional interest rate increases, which some market participants have begun to estimate prematurely,” said John Kirshner, head of U.S. securitized products and portfolio manager at Janus Henderson Investors.
the 10-year US Treasury bond yield The interest rate fell sharply, now at 4.655%, compared to last Friday's close of 4.774%, as traders tempered their interest rate expectations.
This gave stocks room to breathe. the Standard & Poor's 500 It jumped by 1.83% Dow Jones Industrial Average It rose by 1.65% Nasdaq Composite It rose by 2.45%. This was the best day for all three major averages since November 6th.
Upbeat earnings reports from banks also added to the cheer. Their financial results are often a forecast of the overall direction of the economy: banks' top lines grow when businesses and consumers engage in more financial activity, which in turn helps the economy grow.
For investors, the stars were aligned on Wednesday. But while the sky is constantly changing, fluctuations remain, in the form of a new American administration and policies to come.
— CNBC's Jeff Cox, Hakyung Kim and Lisa Kailai Han contributed to this report.
