S&P 500 News: Inflation Eases, Tesla Soars, and Goldman Sachs Leads Bank Rally

The softer-than-expected CPI results reassured traders that inflationary pressures are cooling, potentially easing the Federal Reserve’s stance on further rate increases. Markets are pricing in a 50% chance of two rate cuts by the end of 2025, with the first expected in June.

How Did Tech Stocks Perform?

Technology stocks were among the top gainers as lower Treasury yields boosted growth-oriented sectors. Tesla climbed 5%, while Nvidia rose 2%, reflecting renewed investor confidence. The Nasdaq Composite’s 2% rally highlighted the sector’s sensitivity to interest rate factors.

Are Banks the Stars of the Day?

Banks stood out with robust quarterly earnings. JPMorgan Chase rose 0.6% after delivering a record annual profit, while Goldman Sachs surged 4.9%, posting its best quarterly performance since 2021. Wells Fargo jumped 4.2% on strong investment banking results, and Citigroup added 3.9% after swinging back to profitability.

The S&P 500 Banks Index gained 1.9%, outperforming broader markets. Strong bank earnings underscored resilience in the financial sector, supported by stable loan growth and increased dealmaking activity.

Which Sectors Drove Broader Gains?

Real estate stocks outperformed, climbing 2.2% as falling Treasury yields boosted the sector’s appeal. Consumer discretionary and communication services also saw strong gains, rising 2.23% and 2.44%, respectively.

Growth-oriented sectors broadly benefited from easing inflation concerns and a favorable earnings season. Advancing stocks significantly outnumbered decliners, with the S&P 500 recording 13 new 52-week highs.