Markets had every reason to celebrate Tuesday. Inflation came in tame, the S&P 500 sat within spitting distance of a record high, and crude oil rallied for a fourth straight day. Yet Wall Street couldn't quite muster the enthusiasm, trading sideways as earnings season delivered its first round of mixed results.
The Consumer Price Index for December rose 2.7% year-over-year, matching both the November reading and economist forecasts. Core CPI, which strips out volatile food and energy prices, came in at 2.6% annually, actually landing slightly below expectations. It's the kind of benign inflation report that keeps Federal Reserve rate cuts firmly on the table for later in 2024.
But if stocks were taking a breather, commodities certainly weren't. Silver continued its remarkable run, jumping 4.5% to hit $89 an ounce as supply concerns intensified. The grey metal has now surged 22% since the start of the year, and we're barely two weeks into January. That's the kind of move that makes you wonder what traders know that the rest of us don't.
By midday in New York, the S&P 500 sat essentially flat at 6,970, tantalizingly close to Monday's record high of 6,986. The Dow Jones Industrial Average dropped 0.5%, weighed down by financial stocks having a rough day. The tech-heavy Nasdaq 100 managed a modest 0.1% gain thanks to strength in semiconductors, while the Russell 2000 added 0.2%. Small caps are now eyeing their seventh positive session in the past eight, which is the kind of streak that gets overlooked when you're focused on the big names.
Tuesday's Performance In Major US Indices, ETFs
| Major Indices | Price | Chg (%) |
| Russell 2000 | 2,639.46 | +0.2% |
| Nasdaq 100 | 25,821.82 | +0.1% |
| S&P 500 | 6,976.33 | +0.0% |
| Dow Jones | 49,330.68 | -0.5% |
Looking at the major ETFs, the picture was similarly muted. The Vanguard S&P 500 ETF (VOO) sat flat at $638.46, while the SPDR Dow Jones Industrial Average (DIA) slipped 0.6% to $492.92. The Invesco QQQ Trust Series (QQQ) held steady at $627.33, and the iShares Russell 2000 ETF (IWM) ticked up 0.1% to $261.76.
Sector action told a clearer story. The Energy Select Sector SPDR Fund (XLE) outperformed with a 1.5% gain as crude prices climbed, while the Financial Select Sector SPDR Fund (XLF) lagged badly, down 1.8%. That financial sector weakness set the tone for some of Tuesday's biggest individual stock moves.
Earnings Season Opens With A Whimper And A Bang
JPMorgan Chase & Co. (JPM) learned the hard way that beating earnings estimates isn't always enough. Shares fell more than 3% despite solid numbers, as investors fixated on weaker investment banking fees and cautious management commentary around loan growth. When you're the bellwether bank, people parse every word for clues about the broader economy.
Delta Air Lines Inc. (DAL) had an even rougher day, sliding over 4% after issuing soft forward guidance. The culprits? Cost pressures and what the company called normalization in post-pandemic travel demand, which is corporate speak for "people are done paying crazy prices for plane tickets." The weakness spread across airline stocks broadly, as investors worried about margin compression.
On the flip side, Moderna Inc. (MRNA) emerged as the S&P 500's top performer, rallying 14% after the biotech company issued bullish growth forecasts for its vaccine business. After a tough stretch, Moderna investors finally had something to cheer about.