Stocks rose higher Wednesday morning as market participants cheered the latest consumer price index reading that showed core inflation slowing in December. The Dow Jones Industrial Average climbed over 700 points, while the S&P 500 Index and Nasdaq Composite advanced about 1.8% and 2.5%, respectively.

Here's how the market settled on Wednesday:

S&P 500 Index (SPY  ): +1.83% or +106.99 points to 5,949.90

Dow Jones Industrial Average (DIA  ): +1.65% or +703.21 points to 43,221.49

Nasdaq Composite Index (QQQ  ): +2.45% or +466.84 points to 19,511.23

FedWatch:

U.S. Economic Activity rose "slightly to moderately" across the its 12 districts throughout the holiday season (late November- December), the Federal Reserve said in its Beige Book survey released Wednesday afternoon.

"Most districts reported modest increases in selling prices, though there were instances of flat or decreasing prices as well, particularly in the retail and manufacturing sectors," the reported stated.

Moving Markets:

Consumer Prices rose at a mild rate in December, data from the Bureau of Labor Statistics showed Wednesday, offering another sign that inflationary pressures are easing across the U.S. economy.

The consumer price index (CPI) rose at a seasonally adjusted rate of 0.4% last month, bringing the 12-month inflation rate to 2.9% -- both rating came roughly in-line with the consensus estimate from economists polled by Dow Jones. On a core basis, which excludes food and energy prices, the CPI rate rose by a less-than-expected 0.2% on the month and 3.2% year-over-year.

"Today's CPI may help the Fed feel a little more dovish. It won't change expectations for a pause later this month, but it should curb some of the talk about the Fed potentially raising rates," said Ellen Zentner, chief economic strategist at morgan Stanley Wealth Management, quoted by CNBC. "And judging by the market's initial response, investors appeared to feel a sense of relief after a few months of sticker inflation readings."

On the Earnings Front:

JPMorgan Chase (JPM  ) reported record fourth quarter and annual earnings and revenue on Wednesday, with its quarterly profit notably rising 50% to $14 billion as noninterest expenses declined 7% year-over-year. CEO Jamie Dimon, who heads the largest U.S. bank by several metrics, said the economy continues to be "resilient," as low unemployment and healthy consumer spending helps outweigh inflation concerns.

"However, two significant risks remain," Dimon said in an earnings statement. "Ongoing and future spending requirements will likely be inflationary, and therefore, inflation may persist for some time. Additionally, geopolitical conditions remain the most dangerous and complicated since World War II. As always, we hope for the best but prepare the firm for a wide range of scenarios."

BlackRock (BLK  ) reported strong fourth-quarter earnings on Wednesday, with its assets under management reaching a record high of $11.55 trillion, topping the $10 trillion posted a year earlier and the $11.48 trillion reported in the third quarter. The New York-based asset manager said clients benefited from the post-election stock market rally in November, as investor sentiment improved on bets that more deregulation and lower corporate taxes are coming under a second Donald Trump presidency.

"For many companies, periods of M&A contribute to a pause in client engagement. At BlackRock, clients are instead embracing and rewarding our strategy," CEO Larry Fink said in a statement.

Wells Fargo (WFC  ) shares climbed higher Wednesday after the bank reported better-than-expected fourth quarter results and issued strong forward guidance. The bank expects 2025 net interest income to increase in a range of 1% to 3% than 2024's total of $47.7 billion; net interest income represents what a lender profits from loans.

"Our earnings profile continues to improve, we are seeing the benefit from investments we are making to increase our growth and improve how we serve our customers and communities, we maintained a strong balance sheet, we returned approximately $25 billion of capital to shareholders, and we made significant progress on our risk and control work," CEO Charlie Scharf said in a statement.

Goldman Sachs (GS  ) shares also rose on Wednesday after the lender posted better-than-expected trading revenue in its fourth-quarter results. Notably, its equities trading segment generated $3.45 billion in revenue, while fixed income trading totaled $2.74 billion and investment banking fees came in at $2.05 billion -- each topping or matching analyst estimates.

"With an improving operating backdrop and growing CEO confidence, we are harnessing the power of One Goldman Sachs to continue to serve our clients with excellence and create further value for our shareholders," CEO David Solomon said in a statement.

Citigroup (C  ) joined its peers on Wednesday, with its fourth-quarter earnings also topping estimates. Additionally, the bank announced a $20 billion stock buyback and said it expects its return on common equity to range between 10% and 11% in 2026 -- which is below its previously stated medium-term goal of 11% to 12%.

"2024 was a critical year and our results show our strategy is delivering as intended and driving stronger performance in our businesses," CEO Jane Fraser said in a statement. "Our net income was up nearly 40% to $12.7 billion and we exceeded our full-year revenue target, including record years in Services, Wealth and U.S. Personal Banking."

In the News:

The U.S. Department of Transportation (DOT) sued Southwest Airlines (LUV  ) on Wednesday, claiming the airline was responsible for more than 90% of chronically delayed flights (defined by the agency as a flight that is flown at least 10 times a month and arrives more than 30 minutes late more than half the time).

The agency separately fined Frontier Airlines (ULCC  ) $650,000 for operating chronically delayed flights, but will allow $325,000 to be suspended if the airline doesn't operate any repeatedly delayed flights over the next three years.

Stocks associated with Quantum Computing jumped higher Wednesday after Microsoft (MSFT  ) unveiled its "quantum-ready" plan for businesses heading into 2025. Nvidia (NVDA  ) also announced a "Quantum Day" set for its GTC conference in March during the previous trading session, also boosting growth investing sentiment. Quantum computing is an emerging field of computer science that aims to use quantum mechanics to solve complex problems mch faster than traditional computers.

"We are right on the cusp of seeing quantum computers solve meaningful problems and capture new business value," wrote Mitra Azizirad, president and chief operating officer of strategic missions and technologies at Microsoft, in a blogpost.

Names including Rigetti Computing (RGTI  ), D-Wave (QBTS  ) and IonQ (IONQ  ) all rallied higher on the news.

The U.S. Federal Trade Commission (FTC) has sued Deere & Company (DE  ), the agency announced Wednesday, claiming the agricultural equipment manufacturer holds a monopoly on repair services that increases costs and impacts farmer's crop schedules. The lawsuit alleges that Deere has curbed customers' ability to repair their equipment, causing them to only have access to the company's network of authorized repair providers to fully fix equipment.

"Illegal repair restrictions can be devastating for farmers, who rely on affordable and timely repairs to harvest their crops and earn their income," said FTC Chair Lina Khan in a release.

Wells Fargo analyst Ike Boruchow named Lululemon Athletica (LULU  ) as one of its best picks to invest in a mixed retail sector. The firm also reiterated its Equal Weight rating on the athleisure apparel retailer, and increased its price target to $375 per share from $350, representing about a 4% downside from Tuesday's close.

"Our view is simply that the playing field isn't level anymore. Some companies are struggling to some degree with unique brand/business model pressures, some are in the early-to-middle innings of solid turnaround efforts, some have just hired new leadership and are beginning turnarounds, while some have actually been resoundingly successful and are in a great financial position [going forward], in our view," Boruchow wrote in a note to clients on Wednesday.

For Thursday:

Market participants will parse through December's U.S. retail sales numbers Thursday morning, alongside earnings reports from companies including UnitedHealth Group (UNH  ), Bank of America (BAC  ) and Morgan Stanley (MS  ) slated to release before opening bell.