Traders work on the floor at the New York Stock Exchange in New York City, U.S., Dec. 17, 2025.
Brendan McDermid | Reuters
The S&P 500 was on pace to snap a four-day slide on Thursday, boosted by lighter-than-expected inflation data that brightened the outlook for lower interest rates in 2026 and blowout guidance from chipmaker Micron Technology.
The broad market index popped 0.8%, while the Nasdaq Composite advanced 1.5%. The Dow Jones Industrial Average hovered around the flatline but was nearly 480 points higher earlier in the day.
The delayed November consumer price index report — the first since the U.S. government shutdown ended last month — showed headline annual inflation of 2.7%, according to the Bureau of Labor Statistics, below the 3.1% that economists polled by Dow Jones had expected. The 12-month rate for core CPI, which excludes food and energy, was 2.6%, was also lower than the Dow Jones forecast of 3%.
The report was pushed back from its original release date of Dec. 10. The BLS had canceled the release of the October inflation report in late November as a result of the longest-ever shutdown, meaning that Thursday’s reading did not have all the usual data points of a standard CPI report.
Given the lack of October comparison data, economists might not place too much significance on this reading as the beginning of a downward trend in inflation. Nonetheless, stocks extended their gains after the report, as initial jobless claims were below what economists had estimated as well.
“It does seem that the inflation came down a little bit quicker than you might have thought, so the December data may roll it back a little bit,” said Chris O’Keefe, lead portfolio manager at Logan Capital Management. “I think that we are becoming … as investors a little bit more accepting of the fact that 2% inflation simply may not be attainable in the current environment, but we’ll see.”
During Thursday’s session, Micron was a standout winner, jumping 11% after the semiconductor play topped Wall Street estimates on top and bottom lines for the fiscal first quarter and offered a strong revenue forecast for the current period. Micron helped rekindle the artificial intelligence trade, which has seen weakness in recent sessions.
“Micron’s report was indicative of the fact that spending is going to be huge and continue to be huge going for the next 12-18 months,” O’Keefe said. “There will be winners and losers in this, and that needs to get sorted out, but if you follow the earnings here, I wouldn’t give up on the AI trade. I think that some of these stocks now have just huge upside given the pullbacks.”
Stocks are coming off of a rough trading session, pressured by a rout in tech stocks that was sparked by concerns around one of Oracle’s data center projects and the broader financing methods behind companies’ massive AI deals. The S&P 500 and the 30-stock Dow on Wednesday closed out their fourth negative day. The Nasdaq Composite was the laggard of the three major indices and lost almost 2%.
Even as investors have been rotating away from tech names as of late, the sector is on pace to end 2025 with a roughly 21% advance.
