US stocks soar 4% and yields plunge after CPI report shows inflation cooling more than expected in October

• US stocks soared as much as 4% early Thursday after October's CPI report showed a decline in inflation.
• The annual US inflation rate was up 7.7% in October, which was below economist estimates of 7.9%.
• The 10-year US Treasury yield plunged 20 basis points as expectations of a Fed pivot grow.

US stocks soared as much as 4% early Thursday after the October consumer price index showed a cooldown in inflation, potentially giving the Federal Reserve some breathing room in its current interest rate hiking cycle.

The CPI rose 7.7% on an annual basis, below economist estimates for a rise of 7.9%. On a monthly basis, it climbed 0.4% in October, below estimates for a rise of 0.6%. Meanwhile, core monthly inflation, which excludes food and energy, increased 0.3%, below estimates for a rise of 0.5%.

The move in assets was immediate following the CPI release, with the 10-year US Treasury yield plunging an immediate 20 basis points. The move isn't a surprise to JPMorgan, which estimated a CPI reading of 7.7% would spark a 2.5% to 3.5% surge in the S&P 500.

Here's where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:

• S&P 500: 3,881.32, up 3.54%
• Dow Jones Industrial Average: 33,378.25, up 2.66% (864.31 points)
• Nasdaq Composite: 10,875.20, up 5.04%

"Hard to believe that a 7.7% year over year inflation rate is reason for celebration, but the 0.3% monthly change in core CPI reduces pressure on the Fed to raise rates another 0.75% at their next meeting," Bryce Doty of Sit Fixed Income Advisors told Insider.

Here's what else is happening this morning:

• The fallout from FTX's ongoing implosion continues. Here's how the company, once valued at $32 billion, fell so hard that it's on the verge of bankruptcy.
• JPMorgan said the FTX fiasco could spark a 25% price decline in bitcoin to $13,000 as trust in the industry is shaken to its core.
• Tesla was removed from Wedbush's best ideas list as CEO Elon Musk focuses his attention on Twitter and sells more of his Tesla shares.

In commodities, bonds and crypto:

• West Texas Intermediate crude oil rose 0.91% to $86.61 per barrel. Brent crude, oil's international benchmark, rallied 1% to $93.58.
• Gold rose 1.26% to $1,735.30 per ounce.
• The yield on the 10-year Treasury plunged 22 basis points to 3.92%.
• Bitcoin rose 5.83% to $17,419, while ether jumped 8.85% to $1,277.