Consumer prices rose last month at the slowest 12-month pace since December 2021, closing out a year in which inflation hit the highest level in four decades and challenged the Federal Reserve’s ability to keep the U.S. economy on track. The Labor Department said that its consumer-price index, a measurement of what consumers pay for goods and services, climbed 7.1% in November from a year ago, down sharply from 7.7% in October. The pace built on a trend of moderating price increases since June’s 9.1% peak, but it remained well above the 2.1% average rate in the three years before the pandemic. Core CPI, which excludes volatile energy and food prices, rose 6% in November from a year ago, easing from a 6.3% gain in October. September’s 6.6% increase was the biggest jump since August 1982. Prices also softened significantly on a month-to-month basis, with gasoline, utility, medical care services and used-car prices all falling. Price increases moderated for restaurant meals, while prices for new vehicles remained flat. The CPI increased 0.1% in November from the prior month, compared with 0.4% in October. Core CPI rose 0.2% in November, down from 0.3% in October and 0.6% in August and September. The figures leave the Fed on track to lift interest rates by 0.5 percentage point on Wednesday, following larger increases of 0.75 point at their past four meetings.

The Swiss stock market reacted to the surprisingly low US inflation data for November with significant gains on Tuesday. The SMI added 0.9 per cent to 11,137 points. Among the 20 SMI stocks, there were 16 price gainers and three price losers with one share closing unchanged. 46.98 (previously: 42.15) million shares were traded. Technology stocks were in demand, Logitech improved by 3.7 per cent, among the second-line stocks Ams-Osram advanced by 5.2 per cent and Temenos by 4.0 per cent. Investors also took advantage of economic cyclicals. ABB, Geberit and Sika posted gains of 1.9 to 2.4 per cent. Alcon and Lonza, which were already in strong demand on Monday, improved by a further 1.2 and 2.5 per cent. However, investors held back on Novartis (-0.2%). At Credit Suisse (-0.6%), profit-taking is likely to have weighed on the share price again. UBS shares edged around 2.9 per cent higher.

European stocks closed on a strong note on Tuesday as tamer-than-expected U.S. inflation data helped ease concerns about the outlook for interest rates and lifted investor sentiment. The Stoxx Europe 600 index added 1.3% at 442.6 points. In Paris, the CAC 40 and the SBF 120 were both up 1.4%. In Frankfurt, the DAX 40 gained 1.3%, while the FTSE 100 in London increased by 0.8%. Automotive supplier Plastic Omnium (+1.1%) has completed the purchase of Hella's 33.33% stake in their joint venture HBPO for Plastic Omnium already owned 66.66% of the company and consolidated it at 100%. German airline Lufthansa (up 3.7% in Frankfurt) on Tuesday raised its outlook for 2022 on strong demand and said its October and November results were better than expected. Deutsche Bank downgraded its recommendation on British airline easyJet (-2.6% in London) to "sell" from "hold" and lowered its price target to 330 pence from 415 pence.

U.S. stock indexes climbed and bond yields fell Tuesday after fresh data showed inflation eased last month, a welcome development for investors who have been anxious about rising prices for much of the year. The S&P 500 added 29.09 points, or 0.7%, to 4019.65, paring some of its stronger gains from earlier in the session. The Nasdaq Composite rose 113.08 points, or 1%, to 11256.81. The Dow Jones Industrial Average added 103.60 points, or 0.3%, to 34108.64. Shares of technology heavyweights, among the most sensitive to interest rate expectations, led the way in trading Tuesday. Meta Platforms added $5.44, or 4.7%, to $120.15. Alphabet shares jumped $2.32, or 2.5%, to $95.63. Tesla shares, on the other hand, fell $6.87, or 4.1%, to $160.95, continuing a slump that has dragged the stock down 54% for the year. Oracle (-0.9%) reported better-than-expected quarterly results on Monday evening, led by a sharp rise in revenues from its cloud computing platforms and applications. United Airlines (-6.9%) announced on Tuesday that it had ordered 100 Boeing 787 Dreamliners, with an option to purchase an additional 100. The contract is worth $30 billion at list price. Boeing shares rose 0.5%. Tesla shares (-4.1%, $160.95) fell to their lowest level of the year on fears of slowing sales and criticism of the carmaker's chief executive, Elon Musk, who has been accused of being consumed with buying Twitter. Apple (+0.7%) plans to open its operating system to other online app shops in response to upcoming European legislation designed to protect publishers, who have complained about the App Store model, Bloomberg reported Tuesday. Raytheon shares rose 0.4 percent after the arms company announced a new $6 billion share buyback plan. Shares of publicly traded companies tied to cryptocurrency kept slumping, with a House Financial Services Committee hearing on the FTX collapse taking place Tuesday. Shares of Silvergate Capital, a bank tied to crypto, tumbled $2.53, or 12%, to $18.73, continuing a punishing stretch for the company. Coinbase shares dropped $3.91, or 9.2%, to $38.69. Both have lost more than 80% of their value this year.

In Asia, major indexes broadly closed with gains on Wednesday. South Korea’s Kospi rose 1%, Hong Kong’s Hang Seng added 0.9% and Japan’s Nikkei 225 gained 0.8%. China’s Shanghai Composite edged 0.3% higher. Shijiazhuang Yiling Pharmaceutical loses almost 10 per cent. The company manufactures a traditional Chinese medicine used for covid treatments. However, now Pfizer's drug Paxlovid went on sale in China. In South Korea, wind tower manufacturer CS Wind climbs 4.8 % following an order from the United States.

U.S. government debt yields slipped on Tuesday, led by 2- and 3-year rates, after November’s consumer-price index report produced a modest rise in inflation and raised hopes that the worst spell of price gains in four decades is receding. The 10-year Treasury note eased by 10 basis points to 3.518%. The 2-year Treasury note fell by 16 basis points to 4.237%.

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