Stocks Spike by Most in Two Years on Inflation Relief

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Rick Rieder, chief investment officer of global fixed income at BlackRock Financial Management Inc.: “Today’s CPI report showed some moderate improvement as some of the previously elevated excessively high inflation-drivers, such as used cars, started to decline at a faster pace.”

Michael Landsberg, chief investment officer, Landsberg Bennett Private Wealth Management “We are preparing for an environment where interest rates remain higher for longer. Investors should be more concerned with the effect that rising rates into a decelerating economy has on their portfolio values rather than the current level of inflation.”

Max Gokhman, chief investment officer for AlphaTrAI: “We expected that there would be deceleration of core goods prices, but seeing services slump too was a bigger bonus than any banker will get this year. That said, this won’t budge the Fed to rethink a 50bp hike in December, so traders curb their initial enthusiasm.”

Ipek Ozkardeskaya, senior analyst at Swissquote Bank: “Hallelujah! We finally saw a strong beat in terms of inflation in the US. Both the headline and the core figures came lower than expected. And that helped softening the hawkish Fed expectations, pull the US dollar and the yields lower. The soft inflation has been a puff of fresh air for the entire market.”

Guillermo Hernandez Sampere, head of trading at asset manager MPPM GmbH: “Pivot Party to start right now, short squeeze will ignite the rally. If the remaining cash comes to work we’ve seen the lows for a while.”

James Athey, investment director at Aberdeen Asset Management: “Equities will love this and are likely to pick up the baton and keep running. Of course that may make the Fed uncomfortable at this early stage in the disinflation process and so watch out for Fedspeak if equities get too frothy.”

Update on Upticks

Some of the main moves in markets Thursday include the following:

The S&P 500 rose 4.7% as of 2:08 p.m. New York time
The Nasdaq 100 rose 6.3%
The Dow Jones Industrial Average rose 3.2%
The MSCI World index rose 3.8%
Bitcoin rose 11% to $17,410.05

This story was produced with the assistance of Bloomberg Automation.

(Image: Bloomberg)