Stocks rallied on Wednesday after the December CPI data revealed lower-than-expected core inflation, signaling a potential easing of inflationary pressures. Additionally, strong earnings reports from major banks, including JPMorgan Chase and Goldman Sachs, fueled investor optimism.
This report comes from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Subscribe on Wednesday to receive it daily. The December consumer price index ( CPI ) revealed that core inflation, which excludes food and energy prices, rose 0.2% on a monthly basis and 3.2% for the year. The annual reading was down 0.1 percentage points from November. Both core readings were also 0.
1 percentage point below expectations. This positive news for investors comes amidst a period of uncertainty and volatility, with the ongoing conflict in the Gaza Strip adding to global concerns. The Israeli security cabinet is expected to vote on a potential ceasefire agreement, which, if approved, will involve a full ceasefire and the withdrawal of Israeli forces from populated areas in the Gaza Strip. U.S. President Joe Biden announced the potential deal, offering a glimmer of hope for peace in the region. Meanwhile, Taiwan Semiconductor Manufacturing Company (TSMC) reported its December revenue last week, bringing its annual total to 2.9 trillion New Taiwan dollars ($88 billion) — its highest annual sales since the company went public in 1994. This surge in revenue highlights the continued strength of the global chip industry.Turning to Wall Street, JPMorgan Chase stock surged after the bank handily beat Wall Street estimates on both profit and revenue for the fourth quarter. JPMorgan executives expressed optimism about the future, despite CEO Jamie Dimon having previously called the stock expensive. Separately, Goldman Sachs CEO David Solomon announced that the bank will hold a board meeting on January 9 to review its business direction, sparking speculation about a possible sale. CNBC's Ryan Browne spoke to industry analysts to explore potential buyers for the investment giant. Finally, a string of positive news has emerged for investors after a dismal start to the year marked by weekly losses due to persistent inflation worries. The December CPI data showed core inflation lower than expected, prompting a decline in interest rate expectations. The stock market also received a boost from upbeat earnings reports by banks, whose financial results often serve as a bellwether for the overall economy.
INFLATION CPI EARNINGS STOCK MARKET JP MORGAN GOLDMAN SACHS TAIWAN SEMICONDUCTOR
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