Wall Street Rockets As February Inflation Cools More Than Expected

Stocks surged Wednesday morning, with major indices poised to snap a two-day losing streak, as cooler-than-expected inflation reinforced expectations for Federal Reserve rate cuts in 2025.

Futures on major U.S. indices rebounded sharply, with the S&P 500 climbing 1.1% by 9:00 a.m. ET, the Nasdaq 100 jumping 1.6%, and the Dow Jones Industrial Average rising 0.8%.

Small caps, as tracked by the iShares Russell 2000 ETF IWM, were up 1.2%.

Rate Cut Bets Gain Traction

The latest Consumer Price Index report showed inflation cooling more than anticipated in February.

Headline CPI eased to 2.8% year-over-year, coming in below the 2.9% forecast, while core CPI, which strips out food and energy prices, slowed to 3.1%, below expectations of 3.2%

The data strengthened the case for monetary easing, pushing traders to fully price in three Federal Reserve rate cuts in 2025, according to the CME FedWatch Tool.

On the Kalshi event-prediction platform, three rate cuts also emerge as the most likely scenario for 2025.

Commodities Surge, Bitcoin Nears $84,000

Commodity markets reacted strongly to the inflation data, with WTI crude oil climbing 1.6% and copper surging 2.7% to its highest level since May 2024. Silver also gained 1%, while natural gas tumbled 4.4%.

In the cryptocurrency space, Bitcoin BTC/USD rose 1.4% to approach $84,000, while altcoins saw notable gains—Cardano jumped 5% to $0.7590, and Solana advanced 3% to $129.