Wednesday, February 12, 2025
Finance Funds Update
Stock Markets

Dow, S&P 500, Nasdaq futures sink as hot inflation data spooks markets

February 12, 2025


US stock futures slid on Wednesday as investors digested a hotter-than-expected January inflation reading.

Dow Jones Industrial Average futures (YM=F) slipped roughly 1%, coming off a narrow gain for the blue-chip benchmark on Tuesday. S&P 500 futures (ES=F) fell 1.1%, while those on the tech-heavy Nasdaq 100 (NQ=F) slid 1.2%.

The January Consumer Price Index (CPI) out Wednesday showed headline consumer prices rose more than forecast in January as core prices reversed last month’s easing. On a “core” basis, which strips out the more volatile costs of food and gas, prices in January climbed 0.4% over the prior month, higher than December’s monthly gain, and 3.3% over last year, also up from last month.

Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards

At the same time, markets are on alert for more policy surprises from Trump, who is expected to announce reciprocal tariffs on many countries before the end of the week.

Meanwhile, investors combed through a fresh batch of earnings for clues to Corporate America’s resilience. Kraft Heinz (KHC) shares slid after the packaged food maker’s 2025 profit outlook fell short. But CVS Health (CVS) stock got a boost as investors welcomed a smaller drop in quarterly profit than expected.

On the after-hours docket, Reddit (RDDT) results come amid sky-high Wall Street expectations. Robinhood’s (HOOD) report is also in focus after the stock touched a three-year high.

LIVE 7 updates

  • Josh Schafer

    Inflation rises more than expected in January

    New data from the Bureau of Labor Statistics out Wednesday showed that a key inflation metric rose more than anticipated in January.

    On a “core” basis, which strips out the more volatile costs of food and gas, the January Consumer Price Index (CPI) climbed 0.4% over the prior month, an acceleration from December’s 0.2% monthly gain and above the 0.3% economists had expected. On an annual basis, prices rose 3.3%, above the 3.1% economists had projected.

    Headline consumer prices also rose more than expected. The CPI increased 3% over the prior year in January, an uptick from December’s 2.9% annual gain in prices. The yearly increase was above the 2.9% economists had expected.

    The index rose 0.4% over the previous month, ahead of the 0.3% increase seen in November and also on par with economists’ estimates.

    Read more here.

  • Jenny McCall

    JPMorgan: S&P 500 at risk of falling 2% if inflation runs hot

    The S&P 500’s (^GSPC)’ record run could face a setback, according to JPMorgan Market Intelligence. The team estimates the index may drop up to 2% if consumer prices (CPI) rise 0.4% or more in January from the previous month.

    With CPI data due at 8:30 a.m. New York time, markets are on edge. A slightly hotter print could challenge the bullish outlook on US equities. The consensus estimate is for a 0.3% rise in month-on-month CPI.

  • Europe stocks marooned in wait for CPI

    Stocks in Europe trod water on Wednesday, mirroring the muted tone in markets as investors prepared for a fresh reading on US consumer inflation.

    The pan-European Stoxx 600 (^STOXX) index inched up less than 0.1%, staying in range of fresh record highs thanks to solid earnings from the likes of Heineken (HEIA.AS, HEINY).

    In individual benchmarks, Germany’s DAX (^GDAXI) rose 0.3%, while the CAC (^FCHI) in Paris traded flat. London’s FTSE 100 index (^FTSE) hugged the flat line.

  • Gold hits brakes on record-setting rally

    Gold (GC=F) continued to pull back from a recent all-time high on Wednesday, as traders assessed Jerome Powell’s message that the Fed isn’t in a hurry to cut interest rates.

    Prices of gold bullion dropped below $2,890 an ounce, falling for a second day, after a record-setting run toward the key $3,000 level.

    Meanwhile, gold futures slid almost 1% to around $2,906 an ounce, with the shine coming off the non-interest-bearing asset as the 10-year Treasury yield (^TNX) rose.

    Prices for the metal have surged in recent days as investors sought out less risky assets in light of President Trump’s push for tariff hikes.

  • Jenny McCall

    Good morning. Here’s what’s happening today.

    Economic data: Consumer Price Index (January); Real average hourly earnings (January); MBA Mortgage Applications (week ending Feb. 7)

    Earnings: Albermarle (ALB), Biogen (BIIB), CVS Health (CVS), Cisco (CSCO), Dutch Bros (BROS), Generac (GNRC), Kraft Heinz (KHC), MGM Resorts (MGM), Reddit (RDDT), Robinhood (HOOD), The TradeDesk (TTD)

    Here are some of the biggest stories you may have missed overnight and early this morning:

    CPI inflation on deck: What to watch with Fed cuts in focus

    Trump’s crypto company launches strategic ‘token reserve’

    Alibaba’s shares soar after investors buy iPhone AI hopes

    Analyst: Musk’s OpenAI bid a ‘distraction’ dragging Tesla stock

    Gold’s record rally hits pause after Powell’s speech

    Bets on higher US rates face inflation data test

    Why healthcare is the ‘best hedge’ if the AI rally cools in 2025

  • China stock surge has analysts bullish

    China’s AI-driven stock surge is gaining backing from Wall Street strategists, who believe the country’s emerging tech capabilities will help sustain the bull market.

    Analysts from Morgan Stanley (MS), JPMorgan Chase & Co (JPM)., and UBS Group AG (UBS) predict that stock gains fueled by DeepSeek’s artificial intelligence model will continue.

    Bloomberg reports:

  • Alibaba stock soars on iPhone AI hype

    Alibaba (BABA) stock saw a leap over 10% on the news that Apple (AAPL) is working with the Chinese e-commerce platform on breaking into artificial intelligence business in China.

    Bloomberg reports:



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