Coffee With Greta: Extending The CPI Rally

DJIA Futures: +160 (+0.5%)

SPX Futures: +21 (+0.5%)

NASDAQ Futures: +69 (+0.6%)

Good morning friends!

Futures are higher, extending the market’s big post-CPI rally.

Let’s get right to it!

Biggest One-Day Rally Since 2020

Stocks are rising again today after the major indexes skyrocketed on Thursday following the cooler-than-expected CPI.

The Dow Jones jumped more than 1,200 points or 3.7% on Thursday.

While the S&P 500 surged 5.5% and the Nasdaq skyrocketed 7.4%.

It was the largest one-day gain for all three since 2020.

ARK Innovation ETF (ARKK) shares are slipping 0.2% ahead of the open after logging its best day ever on Thursday.

The fund surged 14.5% as tech stocks rallied.

Its biggest holding Zoom Video (ZM) jumped 14.5%, while Tesla (TSLA) rallied 7.4%, and Roku (ROKU) surged 15.4%.

Trading volume also surged with more than 48 million ARKK shares being traded on Thursday vs the 30-day average of about 25 million.

The fund is still down 61% YTD.

The bond market is closed today in observance of Veterans Day.

The closure comes after Treasury yields plunged on Thursday.

The 2-year yield ended the session down 33 basis points at 4.32% while the 10-year yield dropped 32 basis points to 3.82%.

Investors poured back into bonds after the CPI showed inflation pressures may have peaked.

That hope also caused traders to lower their expectations for the next Fed meeting.

CME Group’s FedWatch Tool shows 85.4% now anticipating a smaller 50bps hike at the December 14 meeting.

Mortgage rates fell sharply alongside the 10-year Treasury yield Thursday.

Mortgage News Daily shows the average 30-year fixed rate plunged 60 basis points and settled at 6.62%.

That was the largest one-day drop since the start of the pandemic.

Oil prices are rising today after Chinese authorities eased some Covid restrictions in the country.

West Texas Intermediate crude futures are up 3.2% to over $89 bbl while Brent crude futures are up 2.9% to over $96 bbl.

The changes include shorter quarantined times for international travelers and those who’ve been in contact with an infected individual.

China also narrowed its contact tracing to just close contacts of Covid infections.