Stock Market Update Wednesday February 12, 2025

Stock Market Update Wednesday February 12, 2025Stocks ended the day lower, but the decline was not as severe as it could have been. A higher-than-expected Consumer Price Index (CPI) report caused the S&P 500 (SPX) to drop sharply in pre-market trading, briefly falling to the important 6,000 level before recovering. Throughout most of the session, the index hovered around 6,050 and finished down by 0.3%. In contrast, the Nasdaq 100 (QQQ) managed to achieve a small gain, while the interest-rate-sensitive Russell 2000 (IWM) underperformed, dropping by 0.9%.

Away From Stocks: Treasury yields increased and stayed high throughout the session. The 10-year yield rose by 9 basis points to 4.63%, up from 4.42% on February 4th, which put pressure on riskier assets. This shift was evident in the bond market, where the iShares 20+ Year Treasury Bond ETF (TLT) fell to 87.23. Commodities were also affected, with crude oil prices dropping by nearly 3%. However, market volatility remained low, as the Cboe Volatility Index (VIX) slightly dipped below 16. Investors are now focusing on the Producer Price Index (PPI) release scheduled for tomorrow morning, which may offer more clarity on inflation and its potential impact on Federal Reserve policies.