US stocks rally on light news day ahead of CPI figures

US stocks gained throughout the session as they turned risk on ahead of Tuesday’s CPI figure which is expected to show a moderating of inflation causing investors to hope of a less aggressive Federal Reserve going forward. Tech led gains as the sector most sensitive to market sentiment, the Nasdaq finishing up 1.48% with the Dow and S&P 500 not far behind.

The US dollar was weaker on improved risk sentiment, coupled with an expectation of moderating inflation leading to a softer rate hike path from the Fed. AUDUSD reclaimed the 0.69 support level, the EURUSD retaking the 1.07 support level.

Despite Dollar weakness the Gold price slipped, breaking last weeks lows in an ominous sign for Gold bulls that the market is seeing Gold as a bit frothy after the recent run up.

Crude Oil had a rollercoaster of a session, rallying in the first half of the session on market optimism only to get hammered and give up all the gains on the news that the Biden administration was planning to release 26, barrels from the Strategic Petroleum Reserve (SPR) taking traders by surprise.

In economic releases ahead, the big one of the week will be released later today in the US CPI figures. Rates markets expectations of the Fed’s rate hiking/cutting trajectory have been the main driver of risk assets in recent times, this figure is sure to see some volatility in markets on it’s release, trade with caution.