CPI Matches Estimates – US Market Wrap

Stocks wavered as speculation the market has run too far after the US election offset bets the Federal Reserve will keep cutting rates.

Equities lost steam in the final stretch of New York trading, with the S&P 500 almost erasing an advance partly fueled by in-line inflation data. Shorter-dated Treasuries outperformed, with the yield on two- year notes dropping from the highest since July. Swap traders boosted to about 80% the probability that the Fed will cuts rates again on December 18. The dollar held at a two-year high. Bitcoin rose to around $90,000.

A consumer price index that matched estimates brought a certain degree of relief to traders fearing that a hotter print that could hinder US policy easing. Fed’s Kashkari said that based on the headline numbers, he’s confident inflation is headed in the right direction. He spoke on Bloomberg TV just minutes after the release, emphasizing he hadn’t yet been able to look at the data in detail.

The S&P 500 was little changed. The Nasdaq 100 fell 0.2%. The Dow Jones Industrial Average rose 0.1%. Treasury 10-year yields advanced two basis points to 4.45%.