12:59 PM EST, 01/15/2025 (MT Newswires) -- US equity indexes jumped as easing core inflation put monetary policy hawks on the back foot and strong Q4 earnings from mega-cap banks boosted sentiment.

The Nasdaq Composite jumped 2.2% to 19,456.8, with the S&P 500 up 1.6% to 5,938.3 and the Dow Jones Industrial Average 1.6% higher at 43,172.5. All sectors rose intraday, with consumer discretionary, financials, and communication services among the top gainers.

The US seasonally adjusted core consumer price index grew 0.2% in December, below the consensus estimate for a 0.3% increase in a survey compiled by Bloomberg, and following a 0.3% gain in November, according to data released Wednesday by the Bureau of Labor Statistics. The CPI climbed 0.4%, as expected for headline inflation in the survey, versus a 0.3% increase in the previous month.

Year-over-year core CPI growth slowed to 3.2% in December from 3.3%, while the overall CPI came in at 2.9% versus 2.7% in November.

As expected, rents accelerated but remained below the prior six-month average, Morgan Stanley economists said a research note.

"We expect continued progress ahead as new-lease inflation remains below CPI housing," Chief US Economist Michael T. Gapen said in the note. "Core services ex-housing came in slightly lower than expected despite the acceleration in airfares, with weaker than expected health services and car insurance CPI."

Following December's inflation data, the likelihood for the Federal Reserve to remain on hold, which is almost certain to happen at a monetary policy meeting later this month, fell sharply from May onwards, according to the FedWatch Tool. The Fed has cut rates twice -- 25 basis points and 50 basis points -- since it began its easing cycle late last year. There is almost a 65% chance that the Fed target rate will be cut twice to 3.75% to 4% by the end of this year.

US Treasury yields fell on the back of the easing in core inflation rates, with the two-year rate sinking 9.1 basis points to 4.28%. The 10-year plunged 12.9 basis points to 4.66%.

Further, in economic news, the New York Federal Reserve's Empire State manufacturing index sank to negative 12.6 in January from 2.1 in December, compared with an expected increase to 3 in a survey compiled by Bloomberg. The Empire State Index print is the first for the sector for January and shows the peer group in contraction.

In company news, Goldman Sachs ( GS ) shares were up 5.4% intraday, among the top gainers on the S&P 500 and the Dow, after the company reported higher Q4 earnings and net revenue. BlackRock ( BLK ) climbed 5% intraday after the company reported year-over-year gains in Q4 adjusted earnings and sales. Citigroup ( C ) swung to Q4 profit as revenue jumped from a year ago, helping push the lender's shares up by 7.3% intraday.

Meanwhile, Intuitive (ISRG) advanced 7.3% intraday, the top gainer on the Nasdaq, after reporting preliminary Q4 revenue of $2.41 billion, compared with $1.93 billion a year earlier. Analysts expected $2.2 billion for the quarter ended Dec. 31.

West Texas Intermediate crude oil futures jumped 2.7% to $79.56 a barrel.

Gold futures jumped 1.2% to $2,713.01 an ounce, and their silver counterpart climbed 3.7% to $31.48 per ounce.