Stocks rise slightly ahead of inflation data, Fed meeting

U.S. stocks rallied ahead of a busy week for investors on Monday, with key inflation data and the Fed’s final policy meeting of the year over the next two days.

The S&P 500 (^GSPC) gained 1.4%, while the Dow Jones Industrial Average (^ DJI) increased by 1.5%, or more than 500 points. The technology-intensive Nasdaq composite (^IXIC) rose 1.2%.

The rally served as a rebound in stocks’ worst week since September. The S&P 500 fell 3.4% last week, while the Dow Jones fell 2.8% and the Nasdaq 4%.

Investors were also monitoring developments in the oil markets On Monday, as WTI crude oil jumped 3.3% to trade at $73.39 after stabilizing at a new 2022 low on Friday. The rally was driven by energy stocks. The S&P 500 Energy Index rose 2.5%.

Yields on government bonds also rose, with the yield on the benchmark 10-year US Treasury at around 3.617% early Monday, down a few basis points from Friday’s settlement.

Wall Street is now turning its attention to consumer price data released on Tuesday, which should help illuminate the expected path for interest rates over the coming months. Economists polled by Bloomberg estimate the headline CPI to rise 0.3% for the second month in a row, with the year-over-year CPI rising from 7.7% to 7.3%.

The Federal Reserve will make its next interest rate decision on Wednesday after a two-day policy meeting, with investors expecting a 0.5% hike in the Fed’s benchmark rate.

While this week’s inflation reading and the Federal Reserve’s decision are top of mind for investors, some of Wall Street’s most prominent strategists have another concern: future earnings downgrades.

“The final chapter in this bear market concerns the trajectory of earnings estimates, which are far too high,” Morgan Stanley’s Michael Wilson wrote in a note on Monday. As a result, Wilson called the consumer price index print and Fed meeting “yesterday’s news.”

In company news, Blue Twitter should be relaunched on Monday with an additional nearly 30% for iPhone owners. The service still costs $8 per month, but will be $11 for those who purchase the services through the App Store.

On Monday, investors encountered a risk appetite billions of dollars in transactions before the holidays. Amgen (AMGN) agreed to acquire Horizon Therapeutics in an all-cash deal valued at $27.8 billion, making it the biggest healthcare merger of the year, according to at the Wall Street Journal. Shares of Horizon Therapeutics Public Limited Company (HZNP) jumped 15% on the news.

Coupa Software Embedded (CUT) has reached an agreement to sell itself to private equity firm Thoma Bravo LP for an all-cash deal worth approximately $6.2 billion. Shares jumped 26% on Monday.

Also, grill-maker Weber (WEBR) has reached another agreement with BDT Capital Partners to go private, which is expected to raise $3.7 billion for the purchase. Finally, Microsoft (MSFT) is set to acquire a 4% stake in the London Stock Exchange Group.

Elsewhere in the crypto world, former FTX CEO Sam Bankman-Fried said on Monday that he was “not currently scheduled” to attend the Senate Banking Committee. audience on December 14, although he will testify at a separate hearing by a House panel a day earlier.

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv

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