It was another solid session for the market yesterday, which began tentatively, but found its sea legs early enough to attract buyers. Energy (XLE) led the way, but I was more intrigued with Industrials (XLI), powered by capital goods.

Heat Map & Market Breadth

Big Tech and Communication Services (XLC ) were solid, perhaps inspired by the early reversal in Tesla (TSLA) shares.

Defensive sectors lagged.

Factors

Extended factors were the inverse of Wednesday’s session, with green across the screen, except in low volatility.

Market breadth was impressive. The NASDAQ Composite saw 6.3 billion shares trade higher.

We get the Consumer Price Index (CPI) tomorrow. If there is a surprise, I think it will come in lighter than the consensus.

Today’s Session

Major index futures are moving higher due to CPI coming in lower than expected.

Headline CPI moved down to 0.3% M/M in September from 0.4% in August and below expectations of 0.4%. This is despite a continued acceleration in Energy prices to 1.5% M/M from 0.7% last month, while Shelter declined to 0.2% M/M after last month’s jump. Core CPI also moved lower to 0.2% from 0.3% and below forecasts of 0.3%. This raised the prospects of further rate cuts.