US stocks surged after September CPI came in cooler than expected, rising 3.0% yearly versus the 3.1% forecast by economists. The report, the first major economic release in 23 days due to the government shutdown, cements expectations for an October rate cut, with futures now pricing in a 99% probability. Investors cheered the data as the S&P 500 (^GSPC) and Nasdaq (^IXIC) hit new all-time highs. The bond market also rallied, with the 10-year yield dipping below 4% for the first time since April. Meanwhile, President Trump abruptly canceled trade talks with Canada after an anti-tariff ad featuring Ronald Reagan aired there, calling it “an insult to American workers.” Intel (INTC) jumped 6% after beating on both revenue and earnings, citing stronger PC demand and narrowing foundry losses. CEO Pat Gelsinger said Intel is “making steady progress to rebuild,” but cautioned there’s still a long road ahead. Target (TGT) announced an 8% corporate headcount cut, Deckers (DECK) sank on weak guidance, and Procter & Gamble (PG) rose after topping estimates while warning the consumer environment remains “stable but not great.”

Takeaways:

CPI rises 3.0% vs. 3.1% expected, cementing odds of an October Fed rate cut
Intel beats on earnings and revenue as PC and data center sales improve
Trump cancels trade talks with Canada over anti-tariff ad flap
Target cuts 8% of corporate staff; P&G beats, Deckers slumps on outlook

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Inflation cools, Fed cut locked in, Intel rebounds