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Another strong performance on the major stock market indices again brings us to new 52-week highs on the Dow, S&P 500, and Nasdaq. Following a favorable Consumer Price Index (CPI) report before today’s opening bell and ahead of the Fed’s decision on interest rates tomorrow afternoon, the Dow gained another +173 points, +0.48%, the S&P +0.46%, and the Nasdaq won the session, +100 points or +0.70%. Only the small-cap Russell 2000 was down -0.1% on the day.

The slowly moderating CPI results demonstrate an economy on a trajectory toward a “soft landing” at some point in 2024, with the year-over-year Inflation Rate back down to +3.1% and core CPI year-over-year steady at +4.0%. Energy prices have come down -5.4% and used cars -3.8%; food was up less high than we’ve seen — +2.9% — and shelter was the only sticking point: +6.5%. We’re back down to August levels, with hopes we can see an Inflation Rate sub-3% sometime in the next few months.

Oil prices are continuing to slide currently, with spot WTI crude prices back below $70 per barrel today. We also see this in new 52-week lows for ExxonMobil (XOM), as the U.S. continues to feed the global oil supplies as OPEC+ makes half-hearted attempts to slow the spigots. But the worst-performing stock on the S&P today was Oracle (ORCL), -12% following its revenue miss and cloud-based lag on fiscal Q2 results yesterday afternoon.

Elsewhere, the sun is shining: JPMorgan (JPM) and Visa (V) are enjoying new 52-week highs, as are Boeing (BA) and IBM (IBM), among others. The Airline industry is up, and so are Chipmakers. The Fed had promised us “higher for longer” interest rates, and it appears that — contrary to the doom and gloom many analysts predicted upon such a scenario — industries nearly across the board are living through it just fine.

If anything, this positivity — and its bullish sentiment in the markets for the past six weeks or so — may give Fed Chair Jerome Powell pause when he addresses his press conference following the FOMC announcement that the Fed funds rate will remain in the 5.25-5.50% range. For instance, part of this market ebullience is more firmly being based around the Fed making interest rate cuts no later than June of 2024. Powell might make quick work of this notion in a mere phrase or two. What becomes of these somewhat overbought indices then?

Ahead of tomorrow’s open, CPI sister report Producer Price Index (PPI) will be coming out. This has been the most inflation-resistant of all major economic prints over the last several months; analysts will look to see if core PPI year over year will come in beneath last month’s +2.9%. Also, we’ll get Adobe (ADBE) earnings reported after tomorrow’s close. Will the party still be going on when those numbers hit?

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