Wall Street experienced a modest recovery on Wednesday, driven by an in-line inflation report that reinforced expectations for a December interest rate cut. The US dollar strengthened due to potential tariff tailwinds under the new administration.
Bitcoin surged past $93,000, boosting its market capitalization to $1.8 trillion and fueling enthusiasm across crypto markets. The Consumer Price Index met expectations in October, with annual headline inflation at 2.6% and core inflation steady at 3.3%.
The report alleviated concerns about a potential rate pause in December, driving market odds for a 25-basis-point cut from 58% to 82%. Treasury yields eased slightly due to the report.
By midday, US equity indices were mostly positive, with consumer discretionary and real estate sectors leading the way. However, the tech-heavy Nasdaq 100 underperformed. US Senator John Thune was elected as the new majority leader in a secret ballot.
The dollar hit its highest level since November 2023, marking a fresh one-year high. Gold dipped 0.6%, on track for its fourth consecutive loss. The Dow Jones, Russell 2000, S&P 500, and Nasdaq 100 indices rose 0.4%, 0.4%, 0.3%, and 0.1% respectively.
Major sector performance:
– Consumer Discretionary Select Sector SPDR Fund outperformed, rising 1%.
– Utilities Select Sector SPDR Fund lagged, down 0.3%.
– Rivian Automotive Inc. rallied over 18% after the company announced a joint venture launch with Volkswagen valued at up to $5.8 billion.
– Spotify Technology S.A. rose 12%, while Occidental Petroleum Corp. fell 1.2%.
Source: https://www.benzinga.com/news/econ-s/24/11/41949136/stocks-edge-higher-dollar-hits-1-year-peak-bitcoin-soars-to-93000-whats-driving-markets-wednesday