Investors are maintaining a cautious optimism as they anticipate the release of the consumer price index (CPI) data, which is expected to shed light on inflation trends. The S&P 500 has rebounded from its morning losses, trading above its 100-day moving average, as options traders brace for potentially significant market movements. The recent cooling of the producer price index (PPI) in December, attributed to lower food costs and stable service prices, has alleviated some inflationary concerns. However, mixed signals from PPI components that impact the Fed's preferred inflation measure, the personal consumption expenditures (PCE) gauge, have left the inflation outlook uncertain. The broader market context includes a declining dollar, which has boosted demand for dollar-denominated assets, while crude oil prices have dipped, possibly due to weakening demand or increased supply.
The Vanguard S&P 500 ETF (VOO) experienced a modest increase, rising 0.29% to $536.14 as of 16:20 on Tuesday, January 14.