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Author Message   Entrepreneur Kurra Bewarse Username: Entrepreneur Post Number: 3915 Registered: 05-2011 Posted From: 24.164.46.35 Rating: N/A Votes: 0 Posted on Wednesday, January 12, 2022 - 5:35 pm:    Midday Market Summary: Mega-caps lift market as 10-yr yield declines despite hot CPI data The S&P 500 was up 0.8% earlier today following the release of hotter-than-expected consumer inflation data, but the benchmark index has pared those gains and is now up just 0.3%. The Nasdaq Composite (+0.5%) and Dow Jones Industrial Average (+0.1%) are also trading off session highs. The biggest support in the S&P 500 is the top-weighted information technology sector, which is up a sector-best 0.7%. Four sectors trade lower, including energy (-0.2%) and health care (-0.4%) at the bottom of the standings. Specifying the data, the Consumer Price Index rose 0.5% m/m in December (Briefing.com consensus 0.4%) while the core index, which excludes food and energy, rose 0.6% (Briefing.com consensus 0.5%). On a year-over-year basis, they were up 7.0% and 5.5%, respectively. The report has stirred inflation concerns, but the reaction in the Treasury market is suggesting that inflation-rate expectations could be peaking because of the Fed's plans to tighten policy more aggressively. The inflation-sensitive 10-yr yield is down four basis points to 1.71% while the 2-yr yield trades flat at 0.90%. The decline in the 10-yr yield has provided a lift for the mega-caps, which are outweighing the softness in the broader market. The Vanguard Mega Cap Growth ETF (MGK 252.62, +1.83, +0.7%) trades higher by 0.7% while the Invesco S&P 500 Equal Weight ETF (RSP 162.49, +0.01, unch) trades flat. In corporate news, shares of Biogen (BIIB 223.87, -17.64, -7.3%) are down 7% after Medicare officials proposed to limit coverage of the company's Alzheimer's treatment to only those patients that participated in approved clinical trials. Jefferies (JEF 36.74, -4.69, -11.3%) is down 11% following its mixed earnings report. Elsewhere, oil prices are trading above $83 per barrel ($83.01, +1.79, +2.2%) after the EIA reported a larger-than-expected draw in weekly crude inventories (4.55 mln barrels). That was the seventh straight weekly draw, pointing to healthy demand despite the Omicron variant. Reviewing today's economic data: Total CPI rose 0.5% month-over-month in December (Briefing.com consensus 0.4%) and was up 7.0% year-over-year. This represented the sharpest 12-month increase since June 1982. Core CPI, which excludes food and energy, rose 0.6% month-over-month (Briefing.com consensus 0.5%) and was up 5.5% year-over-year. This was the sharpest 12-month increase since February 1991. The key takeaway from the report is that while some categories, like the energy index, showed a decrease in December, the continuation of the overall trend resulted in another acceleration of the year-over-year inflation rate at the headline and core levels. The weekly MBA Mortgage Applications Index increased 1.4% following a 5.6% decline in the prior week. As a reminder, the Fed's Beige Book for January and the Treasury Budget for December will be released at 2:00 p.m. ET.