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The S&P 500 Index rose 4.1% at 10:21 a.m. in New York, putting the gauge on track for its best inflation-day session since the global financial crisis in 2008, and its best day overall since April 2020.
The rate-sensitive Nasdaq 100 Index rallied 5.6% amid hopes that the Federal Reserve’s tightening program could be less aggressive going forward.
The consumer price index rose 7.7% in October from a year before in what was the smallest annual advance since the start of 2022, official data showed. Signs that inflation cooled by more than forecast fueled a jump in trading activity. Volume in S&P 500 stocks was about 37% above the 30-day average at this time of the day. About 1.8 million options on the SPDR S&P 500 ETF Trust (ASX:SPY) changed hands before 10 a.m., making up 24% of its full-day average reading over the past 10 days.
“Markets are applauding the cooler inflation print,” said Quincy Krosby, chief global strategist for LPL Financial (NASDAQ:LPLA). “Expectations for a downdraft in rates has begun with expectations for the Dec. 14 rate hike anchored at 50 basis points.”
As stocks in the Nasdaq 100 Index outperformed, a gauge of implied volatility in the index fell to 29.7, on track for its first close below the 30 handle since September.
©2022 Bloomberg L.P.
