The stock market gave back some of its morning gains, with the major indexes up roughly 0.7% at midday, after the June consumer price index eased to the lowest pace in more than two years.
The Nasdaq composite had been up more than 1% at midday, and the S&P 500 added 0.7%. Both climbed to the highest since April 2022. The Dow Jones Industrial Average trimmed its gain to 0.5%. The small-cap Russell 2000 climbed 1.1%.
Volume was tracking about 10% higher on the Nasdaq and NYSE compared with the same time on Tuesday.
Apple, which weighs heavily in the Nasdaq and S&P 500, trimmed gains to 0.8% as it finds support at the 21-day exponential moving average. Microsoft is bouncing off the 50-day moving average. Meta Platforms rose to a February 2022 high. And Alphabet is trying to regain its 50-day line.
The Innovator IBD 50 ETF was flat after erasing earlier gains. DraftKings gapped up 7% to a December 2021 high. BofA upgraded the gambling platform to buy from neutral. Duolingo raced 7.5% higher.
Monolithic Power Systems is trying to break out above a 553.64 buy point of a flat base. Volume is heavy.
CPI Data Relieves Stock Market
Inflation continued to tame itself. The June consumer price index climbed 0.2% from the previous month, and 3% from a year earlier. The latter was the smallest 12-month increase since March 2021, the Bureau of Labor Statistics said.
In May, the CPI rose 0.1% month to month and 4% on an annual basis. Core prices, which exclude food and energy items, rose 0.2% from the previous month and 4.8% annually.
Economists expected CPI to rise 0.3% from May and 3.1% on an annual basis, according to Econoday. The estimated core prices were forecast to climb 0.3% and 5% annualized.
After the CPI report, the 10-year Treasury yield lost 8 basis points to 3.9%. Odds for a quarter-point rate hike at this month's Fed meeting remained around 90%.
Quincy Krosby, chief global strategist for LPL Financial, said that while inflation is edging lower, the core remains "sticky."
"The July 26 meeting will still see a rate hike but unless core inflation comes down at faster pace, July 26 won't be a one and done," Krosby noted. "But there's no denying that the Fed is ever closer to its terminal rate and markets are sensing it."
Kardashian News Sparks Coty Shares
Cosmetics maker Coty climbed to the highest level since 2019 but reversed lower at midday. It is in a buy zone from the 12.50 buy point of a lopsided double-bottom base.
The Wall Street Journal reported that reality star Kim Kardashian is in talks to buy back a 20% stake in her beauty products company that she sold to Coty three years ago. Coty, with a market cap of more than $11 billion, has posted uneven bottom-line results for the past eight quarters, according to IBD MarketSmith.
Domino's Pizza soared 11% and briefly touched an August 2022 high and is on pace for its best day since July 2021. The company agreed to list its menu in Uber Technologies' Eats and Postmates food-delivery apps in 28 markets. The agreement marks a shift for Domino's, which had refused to partner with food-delivery app providers. Uber shares edged lower.
InMode rallied 8% and climbed above a 41.84 buy point. The stock, which had cleared resistance around 38 on Monday, is now extended from its buy range. The company raised its full-year revenue outlook and gave Q2 guidance above analysts' estimates. InMode makes devices for plastic and other surgeries that use minimally invasive radio-frequency technology.
WillScot Mobile Mini rose above the 48.50 buy point of a cup-with-handle base. But volume was mild and the stock erased most of the morning's gains.
