US Stock Market Today (Dec. 18, 2025, 1:52 p.m. ET): Dow, S&P 500, Nasdaq Jump on Cooler CPI as Micron Ignites Tech Rebound

Wall Street is pushing higher in Thursday afternoon trading after a softer-than-expected inflation print revived hopes for additional Federal Reserve rate cuts in early 2026—and after Micron’s upbeat outlook helped steady a jittery AI trade.

As of about 1:52 p.m. ET (1:53 p.m. ET snapshot), the major U.S. indexes were higher: the Dow Jones Industrial Average was at 48,074.62 (+0.39%), the S&P 500 at 6,792.91 (+1.06%), and the Nasdaq Composite at 23,084.09 (+1.72%). Small caps also participated, with the Russell 2000 up 0.97%. ^[1]

The tone is notably different from Wednesday’s risk-off slide, when investors recoiled from renewed “AI bubble” worries—only to pivot back toward risk after inflation data landed meaningfully below forecasts and bond yields fell. ^[2]

What’s happening in the U.S. stock market at 1:52 p.m. ET

The broad storyline in early afternoon trade is a classic three-part sequence:

Inflation surprise → rates fall
Rates fall → growth/tech gets a bid
Tech bid → indexes recover from a multi-day skid

Thursday’s move has also been broad-based, with advancing stocks outnumbering decliners on both the NYSE and Nasdaq in late-morning trading, according to market breadth figures cited in Reuters coverage. ^[3]

The catalyst: Cooler CPI revives rate-cut hopes, but with an “asterisk”

CPI came in below expectations

The market’s main spark was the delayed November Consumer Price Index (CPI) report:

Headline CPI: +2.7% year over year (vs 3.1% expected in a Reuters poll)
Core CPI (excluding food and energy): +2.6% year over year ^[4]

That’s “easier” inflation than markets were bracing for—an outcome that tends to support stocks because it increases the odds the Fed can cut rates sooner (or more) without re-igniting price pressures.

But the data is unusually messy this month

Investors are also digesting a major caveat: the U.S. government shutdown disrupted data collection, and the Bureau of Labor Statistics did not publish month-to-month CPI changes because much of October’s price data wasn’t collected. The October CPI release was canceled, and analysts are warning that the lack of detail makes it harder to interpret the true inflation trend. ^[5]

That uncertainty is why strategists have described the report as positive—but not “clean.” In Reuters reporting, one market strategist characterized it as a good report “with an asterisk,” reflecting concerns about statistical adjustments and missing observations. ^[6]

Fed outlook: What markets are pricing after the CPI release

Even with the data caveats, rate expectations shifted in a more dovish direction.

Traders were pricing a 58% chance of a dovish Fed move by March, according to CME FedWatch figures cited by Reuters. ^[7]
The softer CPI also pushed Treasury yields lower, reinforcing the pro-risk setup for equities. ^[8]

Context matters here: the Fed cut rates last week to a 3.50%–3.75% target range, while signaling it wanted more clarity on inflation and the labor market before making additional moves. ^[9]

Tech and AI rebound: Micron leads a semiconductor surge

Micron’s outlook steadies “rollercoaster” AI sentiment

If CPI was the macro trigger, Micron was the single-stock accelerant.

Reuters reported Micron jumped after forecasting quarterly profit at nearly double analysts’ expectations, citing strong AI-related demand. ^[10]
Investopedia similarly highlighted Micron as a top market mover in afternoon trade after earnings beat expectations, tied to demand for AI hardware. ^[11]

The rebound matters because the market had been wrestling with whether AI winners can keep justifying high valuations—especially after a sharp pullback in several large AI-linked names on Wednesday. ^[12]

Chipmakers and mega-cap tech join in

The tech lift wasn’t limited to Micron:

The Philadelphia Semiconductor Index climbed as chip names rallied, per Reuters. ^[13]
Investopedia noted rebounds in major AI-linked stocks including Nvidia and AMD, alongside Amazon and Microsoft among Dow leaders during the session. ^[14]

Sector check: Consumer discretionary, tech, and small caps lead

Thursday’s leadership has featured a familiar “risk-on trio”:

Consumer discretionary outperforms

Consumer discretionary led S&P sector gains, helped by Lululemon, which surged after reports that activist investor Elliott had built a stake worth more than $1 billion. ^[15]

Small caps catch a rate-sensitive bid

Lower yields and shifting Fed expectations also supported small caps. Reuters highlighted the Russell 2000 moving higher as traders weighed a potentially more accommodative rate path. ^[16]

Not everything is green

Even on a strong index day, stock-specific disappointments are still getting punished. Reuters pointed to Birkenstock sliding after an annual profit forecast missed estimates. ^[17]

Big single-stock headlines driving clicks today

Beyond CPI and chips, a handful of corporate stories are also pulling attention (and volume):

Trump Media spikes on a fusion-energy deal

Trump Media & Technology Group jumped after announcing an all-stock deal with TAE Technologies valued at more than $6 billion, according to Reuters and Investopedia coverage. ^[18]

Cannabis stocks in focus on policy speculation

Reuters also flagged cannabis-linked trading activity as investors watched for potential commentary tied to easing marijuana restrictions. ^[19]

After-the-bell earnings watch: Nike and FedEx

For traders hunting the next catalyst after CPI, Nike and FedEx are among the widely followed names reporting quarterly results after the close, per Investopedia’s market rundown. ^[20]

Cross-asset snapshot: Bonds down, oil up, gold elevated

The CPI-driven re-pricing has echoed across markets:

10-year Treasury yield: down to about 4.12%, according to Reuters’ markets wrap ^[21]
Oil: U.S. crude up near $56.46 and Brent around $60.06, with investors also monitoring geopolitics and supply-risk headlines ^[22]
Gold: still historically elevated, with day-to-day moves sensitive to rates and risk appetite ^[23]

Lower yields are doing much of the “heavy lifting” for equities: when bond yields ease, the present value of future earnings looks better—especially for long-duration growth companies (think mega-cap tech).

Forecasts and forward-looking analysis for late 2025 and 2026

Today’s rally is not just about “what happened”—it’s also about “what could happen next.”

1) The “Santa rally” narrative is back

With stocks rebounding sharply after a rough patch, several strategists are pointing to seasonality and positioning into year-end.

A market note from Interactive Brokers (IBKR) Campus argued that the CPI miss restores bullish sentiment and increases the odds of another Fed cut in Q1 2026, adding that the S&P 500 being near its record high keeps “Santa rally” hopes alive. ^[24]
A separate MarketWatch report citing Goldman Sachs said the next two weeks historically skew positive and that 2026 could be a “stock pickers’ market” with low correlation across S&P 500 constituents. ^[25]

2) But the CPI “asterisk” could keep volatility high

A key risk is that markets may be over-interpreting a single CPI report that was distorted by the shutdown.

Reuters emphasized that economists and strategists are wary about the missing observations and the lack of month-to-month CPI detail—meaning December data may be crucial for confirming whether inflation is truly cooling at the pace implied by today’s print. ^[26]

3) IPO outlook turns brighter as risk appetite returns

A “healthy” equity tape often shows up in primary markets, too.

Nasdaq executives told Reuters they see a robust pipeline for billion-dollar-plus IPOs in 2026, pointing to a backdrop of lower interest rates, high valuations, and improved sentiment, and noting that U.S. IPOs have raised $74.7 billion so far this year (per Dealogic data cited by Reuters). ^[27]

That IPO optimism matters for stock investors because it can reflect improving confidence in growth, liquidity, and underwriting demand—especially after a year that included tariff-driven volatility and shutdown disruption.

What to watch for the rest of Dec. 18

If you’re following the U.S. stock market into the close, today’s remaining catalysts cluster into three buckets:

Rates and Fed expectations: Will bond yields keep drifting down, or does skepticism about the CPI methodology bring yields back up? ^[28]
AI and mega-cap leadership: Micron helped stabilize sentiment today, but AI valuation anxiety has been a recurring theme in recent sessions. ^[29]
Earnings reaction and guidance: Nike and FedEx results (and, crucially, forward guidance) could sway consumer, logistics, and broader economic read-throughs heading into the final stretch of 2025. ^[30]

Bottom line: A CPI-driven relief rally—with tech back in the driver’s seat

As of early afternoon on December 18, 2025, the U.S. stock market is staging a robust rebound: inflation surprised to the downside, yields fell, and tech regained leadership—helped by Micron’s strong outlook and a broader chip rally. ^[31]

Still, the unusual data disruption from the government shutdown means investors may treat today’s CPI as a directional signal—not a definitive all-clear. The next few weeks (and the next clean inflation prints) are likely to determine whether this turns into a durable year-end push—or just a sharp bounce inside a choppy market. ^[32]

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