Overview of the Market Movement
On Thursday, Wall Street experienced an upward trend, fueled by a lower-than-expected US inflation report for November. This development kept hopes alive for interest rate cuts by the Federal Reserve (Fed), while Micron, a leading chip manufacturer, reported strong demand projections for artificial intelligence.
Major Market Indices Performance
- The Dow Jones Industrial Average, consisting of 30 major company stocks, increased by 0.14% to reach 47,951.85 points.
- The S&P 500, which includes the most valuable companies, gained 0.79% to close at 6,774.77 points.
- The Nasdaq Composite advanced 1.38% to 23,006.36 points.
US Inflation Report and Its Impact
The Consumer Price Index (CPI) in the United States showed a smaller-than-expected annual increase up to November, as the Labor Statistics Bureau of the Department of Labor failed to publish monthly changes due to a 43-day government shutdown that prevented data collection for October.
“The November CPI was much lower than expected… this is likely to raise doubts about certain adjustments made by statisticians due to the lack of October data,” said Art Hogan, chief market strategist at B. Riley Wealth.
“Overall, it’s a positive report with an asterisk.”
Market Analysts’ Perspectives
According to analysts at Actinver, the markets traded optimistically, benefiting from the release of the US inflation report for November, which came in below consensus expectations.
These figures support the central scenario in the bond market, which anticipates two 25-basis-point interest rate cuts by 2026.
Mexican Stock Market Performance
The Mexican stock market also witnessed gains during Thursday’s trading sessions, supported by economic reports and Banco de México (Banxico) announcements.
- The S&P/BMV IPC, the leading index of the Mexican Stock Exchange (BMV), rose 2.05% to reach 63,807.32 points.
- The FTSE BIVA, managed by the Institutional Securities Exchange (BIVA), increased 2.06% to 1,263.80 points.
After a three-session losing streak that pushed references away from new record highs, local indices surged in value following Banxico’s decision.
Banxico’s Interest Rate Decision
Banxico reduced its reference interest rate by 25 basis points, placing it at 7.00%, following a divided decision among its members.
Key Questions and Answers
- Q: Why did Wall Street rise on Thursday? A: The market gained momentum due to a lower-than-expected US inflation report for November, which kept hopes alive for interest rate cuts by the Federal Reserve. Additionally, Micron’s strong outlook for artificial intelligence demand contributed to the upward trend.
- Q: How did major market indices perform? A: The Dow Jones Industrial Average increased by 0.14%, the S&P 500 gained 0.79%, and the Nasdaq Composite advanced by 1.38%.
- Q: What was the impact of the US inflation report? A: The Consumer Price Index (CPI) showed a smaller-than-expected annual increase up to November. However, the absence of October data raised doubts about certain statistical adjustments.
- Q: How did the Mexican stock market fare? A: The Mexican stock market experienced gains, supported by economic reports and Banco de México’s interest rate decision to cut the reference rate by 25 basis points to 7.00%.
