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October CPI rises in line with forecast

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Rivian soars after Volkswagen increases investment

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Spirit plummets on report of bankruptcy preparation

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Indexes: Dow up 0.11%, S&P 500 up 0.02%, Nasdaq off 0.26%

(Adds final prices, volume data after close)

By Sinéad Carew and Purvi Agarwal

Nov 13 (Reuters) - The Dow and the S&P 500 ended

slightly higher on Wednesday while the Nasdaq lost ground after

October data showed consumer prices rising in line with

expectations, adding support to bets that the U.S. Federal

Reserve will cut interest rates in December.

The consumer price index (CPI) rose 0.2% in October for the

fourth straight month and advanced 2.6% on an annual basis, the

Labor Department's Bureau of Labor Statistics said. Excluding

the volatile food and energy components, the CPI increased 0.3%

in October, meeting economists' forecasts.

After the report, traders' bets reflected a more than 82%

probability for a 25 basis-point interest rate cut at the Fed's

December meeting, up from 58.7% on Monday, according to CME

group's FedWatch tool.

While some Fed officials sounded more cautious on Wednesday,

Minneapolis Fed President Neel Kashkari told Bloomberg TV that

he was confident inflation was headed down, noting that the CPI

data "confirms" that downward path.

"There's some relief inflation didn't come in ahead of

expectations. That was a concern coming into today's CPI

report," said Angelo Kourkafas, senior investment strategist at

Edward Jones. "The fact we got a right-in-line number helped

alleviate some of those fears. Nothing we saw today from today's

data argues against a December rate cut."

Outperformance in the consumer discretionary sector index

, up more than 1% on the day, was likely due to bets on

rate cuts, according to Kourkafas.

Still, Dallas Federal Reserve President Lorie Logan said the

U.S. central bank should proceed cautiously on further interest

rate cuts to keep from inadvertently re-igniting inflation.

The Dow Jones Industrial Average rose 47.21 points,

or 0.11%, to 43,958.19, the S&P 500 gained 1.39 points,

or 0.02%, to 5,985.38 and the Nasdaq Composite lost

50.66 points, or 0.26%, to 19,230.74.

Also implying December rate cut bets, U.S. Treasury 2-year

yields fell sharply after the inflation report.

However, the benchmark 10-year yield regained

ground after the data and rose as high as 4.46% as investors

focused on longer-term expectations that President-elect Donald

Trump's policies could exacerbate inflation.

Still, investors are expecting a pro-business stance and

possible tax cuts from the next administration.

Wednesday's projections that the Republican Party had won a

majority in the House of Representatives suggested that it could

be easier for Trump to push through his policies, according to

Sahak Manuelian, managing director and head of equity trading at

Wedbush Securities.

While Venu Krishna, head of U.S. equity strategy and global

equity-linked strategies at Barclays, sees upside momentum for

risk assets, he said the market is contending with rates,

inflation and valuations that "are bigger headwinds now than

they were in 2016, the last time Trump became president."

In individual shares, Spirit Airlines' ( SAVE ) shares

plunged 59% on Wednesday after a report the U.S. carrier was

preparing to file for bankruptcy protection, while the company

said it was talking with creditors.

Shares of Rivian soared 13.7% after Volkswagen

on Tuesday raised its investment in the EV maker.

Declining issues outnumbered advancers by a 1.41-to-1 ratio

on the NYSE where there were 371 new highs and 113 new lows.

On the Nasdaq, 1,459 stocks rose and 2,839 fell as declining

issues outnumbered advancers by a 1.95-to-1 ratio. The S&P 500

posted 58 new 52-week highs and 15 new lows while the Nasdaq

Composite recorded 201 new highs and 165 new lows.

On U.S. exchanges 16.49 billion shares changed hands

compared with the 13.46 billion average for the last 20

sessions.