US stocks rise as inflation cools further ahead of Fed rate decision

• US stocks rose Tuesday as the latest CPI report showed inflation continuing to slow.
• The annual rate of increase eased to 3.1% in November from 3.2% in October, in line with expectations.

US stocks rose Tuesday as investors weighed another slowdown in inflation ahead of the Federal Reserve's final policy decision of the year.

The consumer price index rose 3.1% year over year in November, in line with expectations and just under the prior month's 3.2% pace. On a month-to-month basis, core CPI rose 0.3%, slightly higher than October's 0.2% rise.

Inflation remains above the Fed's 2% target, and officials are widely expected to keep rates steady Wednesday, while forecasts for the first interest rate cut were pushed back to May 2024.

"After all the hopes and chatter around near-term rate cuts, today's CPI report is a little bit of a mood dampener. Monthly core inflation did not slow in November, picked up slightly on the headline measure, and even sped up on the supercore measure," said Seema Shah, chief global strategist at Principal Asset Management. "Simply put, this isn't enough inflation deceleration to reassert or justify the market's policy easing expectations, particularly at a time when the labor market is still so solid."

On Wednesday morning, investors can also watch for the producer price index report.

The Fed will publish its rate decision at 2 p.m. ET, and Chairman Jerome Powell will follow up with a press conference at 2:30 p.m.

Here's where US indexes stood at the 4:00 p.m. closing bell on Tuesday:

• S&P 500: 4,643.70, up 0.46%

• Dow Jones Industrial Average: 36,577.94, up 0.48% (173.01 points)

• Nasdaq Composite: 14,533.40, up 0.70%

Here's what else is going on today:

• Companies are piling up debt amid a stock buyback spree.
• A mild recession next year will set the stage for a stock rally, an Evercore strategist said.
• Chart of the day: US households hold an 'unprecedented' $18 trillion in liquid assets.
• Kevin O'Leary said a bill to eliminate big investors from the housing market will harm markets.
• Don't expect peak oil demand in our lifetime, JPMorgan's top energy strategist said.
• China's deflation dilemma may be good news for the West.
• Hedge funds filed a lawsuit against the SEC, saying new rules are "contradictory."

In commodities, bonds, and crypto:

• West Texas Intermediate crude oil slid 1.07% to $68.66 a barrel. Brent crude, the international benchmark, slumped 1.08% to $73.32 a barrel.
• Gold dipped 0.2% to $1,982.7 per ounce.
• The 10-year Treasury yield dropped 3.1 basis points to 4.208%.
• Bitcoin inched 0.25% lower to $41,182.