Wall Street just caught a second wind.
If you were looking at your portfolio this morning, you probably noticed a sea of green. It’s been a wild ride lately with all the trade talk and political back-and-forth, but stock market news today August 12 2025 is dominated by one thing: the July Consumer Price Index (CPI) report. Honestly, investors were bracing for impact, but the numbers actually gave the market a reason to breathe.
The S&P 500 climbed 1.1%, finally clawing its way back to a record high we haven't seen since late July. The Nasdaq Composite was even more aggressive, jumping 1.4%. Even the Dow, which has been a bit of a laggard lately, added 473 points. Basically, the "inflation is cooling" narrative is back on the menu, and the bulls are eating it up.
What the CPI Data Actually Told Us
Economists were sweating this one. There was a lot of talk that inflation might tick up to 2.8%, but the headline number came in at 2.7% year-over-year. That’s steady compared to June. It might not sound like a huge win, but in this environment, "steady" is the new "great."
However, if you dig into the "core" inflation—the stuff that ignores food and energy because they’re so volatile—it was a bit stickier than people hoped. It hit its highest point since the start of the year. Gary Schlossberg over at Wells Fargo mentioned that this underlying measure is really what’s going to keep the Fed up at night.
Despite that, the "big picture" traders are betting heavily on a September rate cut. We're talking a 94% chance now, according to the CME FedWatch tool. That’s a massive jump from just yesterday.
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The Trump Factor and the 90-Day Truce
You can't talk about the markets today without mentioning the White House. Late last night, President Trump signed an executive order that basically kicked the can down the road on those massive China tariffs.
He extended the truce by 90 days.
If he hadn't, we were looking at tariffs as high as 145% on Chinese goods starting today. Can you imagine the supply chain chaos? The move was expected, but the official confirmation definitely helped the Nikkei 225 in Japan surge 2.1% and gave U.S. tech stocks a nice cushion.
Winners and Losers: The Airline Paradox
The most bizarre part of the day? The airlines.
Usually, when inflation is a concern, travel stocks get hit. But today, United Airlines (UAL) and Delta (DAL) were the MVPs of the S&P 500, up 10% and 9% respectively.
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Why? It’s a bit of a "good news, bad news" situation.
- The CPI report showed that airfares actually rose 4% last month. For the airlines, that’s pure pricing power.
- Spirit Aviation Holdings (FLYY) is in serious trouble. They filed a warning with the SEC saying they might not be able to keep the lights over due to a cash crunch.
When a low-cost competitor like Spirit looks like it's heading for the exit, the big players like American and United get more market share. Spirit’s stock cratered over 40% today. It’s brutal out there for the budget carriers.
Tech and Semiconductors Get a Boost
Intel (INTC) had a particularly interesting day, finishing up about 5%. This comes right after President Trump called the CEO’s journey an "amazing story." It’s a total 180 from last week when he was calling for leadership changes. On Wall Street, words from the top matter just as much as the balance sheet.
NVIDIA and AMD also saw some movement, though it was a bit more muted. There's a new deal where these companies will pay 15% of their revenue from certain Chinese chip sales to the U.S. government in exchange for licenses. It’s a weird kind of "export tax," and analysts are still trying to figure out if this is going to hurt their margins long-term.
Healthcare and Other Drags
It wasn’t all sunshine and records, though. Cardinal Health (CAH) took a 7.2% dive. They actually beat profit expectations, but they announced a $1.9 billion deal to buy Solaris Health. Investors usually get twitchy when they see big acquisitions, worrying about the debt and the "integration headaches" that come with it.
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Plus, their revenue was a bit light. The market is being very picky right now—if you don't hit every single metric, you get punished.
Why the Bond Market is Acting Weird
While stocks were celebrating, the bond market was a bit more skeptical. The 10-year Treasury yield actually edged up to 4.29%. Usually, if people expect rate cuts, yields fall. But the "core" inflation spike I mentioned earlier has some people worried that the Fed might not be able to cut as deep or as fast as the stock market wants.
Key Takeaways for Your Portfolio
So, what does stock market news today August 12 2025 mean for you?
- Watch the Core CPI: Don't just look at the headline number. If core inflation stays high, the Fed might only give us one small cut in September instead of the series of cuts the market is pricing in.
- The Tariff Seesaw: We have 90 days of peace with China. Expect volatility to return in November as that deadline approaches.
- Airlines are Volatile: The "Spirit effect" is real. Consolidating industries usually help the big incumbents, but watch fuel prices.
The biggest takeaway is that we are officially back in "bad news is good news" territory. The market wants the economy to be just soft enough to force the Fed's hand, but not so soft that we slide into a recession. It’s a narrow tightrope to walk.
Actionable Next Steps
If you're looking to adjust your strategy based on today's moves, here's what to do. First, check your exposure to "hyperscalers" like Microsoft and Meta; they are driving this rally, but they're getting expensive. Second, keep an eye on the retail earnings coming up later this week. If the consumer is still spending despite that 2.7% inflation, the rally might actually have legs. Finally, look at your bond holdings—if yields keep creeping up, those "safe" bond funds might see some price erosion.