* Major U.S. stock indexes down slightly in afternoon
trading
* Data: U.S. consumer prices rise more than expected in Dec
* Dollar up slightly
* Crypto market investors cheer first US bitcoin ETF
approvals
(Updates to 2:45 p.m. EST, adds crude oil settlements)
NEW YORK/LONDON, Jan 11 (Reuters) – Global stock indexes
were flat to slightly lower and the dollar gained on Thursday as
investors digested data showing that U.S. consumer price
inflation came in above economists’ expectations in December.
Investors also were focused on crypto markets after U.S.
regulators late on Wednesday approved the first U.S.-listed
exchange-traded funds to track bitcoin, a big step for the
cryptocurrency world. Several ETFs tied to the spot price of
bitcoin began trading in the U.S. on Thursday.
The consumer price index data raised some doubts that the
Federal Reserve will cut rates as soon as some traders expect.
The day’s data showed headline CPI rose 0.3% last month, for
an annual gain of 3.4%. That was expected to be 0.2% and 3.2%,
respectively.
The odds of a March rate reduction from the Fed fell to 65%
from 67% on Wednesday, according to the CME Group’s FedWatch
Tool.
“This is not pernicious, it’s not a bad number… This is
not a signal of a resurgence of inflation. All it’s saying is
that inflation has come down,” said Thierry Wizman, global FX
and interest rate strategists in Macquarie, New York.
“So, bottom line, this is not dangerous, the Fed will still
be easing,” Wizman said, adding that a rate cut will not happen
in March, as many expected, but will start later in the year.
The Dow Jones Industrial Average fell 10.51 points,
or 0.03%, to 37,685.22, the S&P 500 lost 6.16 points, or
0.13%, to 4,777.29 and the Nasdaq Composite dropped 9.84
points, or 0.07%, to 14,959.81.
The benchmark S&P 500 rose early in the session and briefly
surpassed its record closing high from January 2022. By one
measure, a record high close would confirm the index has been in
a bull market since it bottomed on Oct 12. 2022.
Also, Microsoft overtook Apple as the
world’s most valuable company after the iPhone maker began 2024
with its worst start in years due to concerns over falling
demand.
The pan-European STOXX 600 index lost 0.77% and
MSCI’s gauge of stocks across the globe shed
0.04%.
The dollar index rose 0.049%, with the euro
down 0.05% to $1.0965. The dollar index had traded at
around 102.20 before the data was released.
The greenback gained 0.2% to 145.47 yen, after
earlier reaching 146.10, the highest since Dec. 11.
The benchmark 10-year U.S. Treasury yield was last down at
3.99%.
BITCOIN BOOST
Crypto stocks like Coinbase were down on Thursday,
while bitcoin last rose 2.7% to $47,208.
Though long expected, the green light by the SEC marks a
watershed moment for the world’s best known cryptocurrency.
Standard Chartered’s head of digital assets research Geoff
Kendrick has estimated the approval, along with bitcoin’s
‘halving’ in April, which cuts the currency’s supply and
historically kick-starts price rises, could send it to $100,000
by the end of the year.
“If ETF-related inflows materialize as we expect, we think
an end-2025 level closer to $200,000 is possible,” he said,
assuming that between $50 billion and $100 billion would flood
into the new U.S. ETFs by the end of the year.
Investor focus will soon turn to U.S. earnings season, with
banking giants JPMorgan Chase, Bank of America,
Citigroup and Wells Fargo all due to report
earnings on Friday. Brent futures rose 61 cents, or
0.8%, to settle at $77.41 a barrel, while U.S. West Texas
Intermediate (WTI) crude rose 65 cents, or 0.9%, to
settle at $72.02.
(Reporting by Caroline Valetkevitch in New York; additional
reporting by Marc Jones in London and Herbert Lash in New York
and Ankur Banerjee in Singapore
Editing by Mark Potter, Timothy Heritage and Nick Macfie, and
Aurora Ellis)
