^GSPC Today: January 15 Sticky US CPI delays Fed cuts until June
US CPI 2.7% in December 2025 kept inflation above target and pushed markets to expect the first Fed rate cuts in June, after Chair Powell’s term ends. The S&P 500 index ^GSPC softened as higher-for-longer yields persist. For Japan-based investors, a later pivot affects yen-based returns and hedging choices. We explain what Fed funds futures are signaling, how the benchmark looks on the charts today, and practical steps to keep portfolios steady into mid‑year.
S&P 500 under pressure as cuts slip to June
The index trades near 6,890.59, down about 1.24% on the day, with a range of 6,885.74 to 6,941.30 and a year high of 6,986.33. Volume is below average, and price remains above its 50-day and 200-day averages at 6,819.94 and 6,329.52. This keeps the medium-term uptrend intact even as short-term mood cools.
US CPI 2.7% confirmed sticky prices, keeping inflation above the 2% goal. Fed funds futures now lean toward the first cut in June, after Chair Powell’s term ends, reducing near-term risk appetite. See coverage from Reuters.
With policy support delayed, investors prefer quality balance sheets and steady cash flows. Cash yields stay attractive until cuts begin, which can draw flows from equities. We also see more focus on earnings resilience and pricing power. For dips, buyers may stagger entries to manage volatility while keeping exposure to secular growth.
What it means for Japanese portfolios
For Japan-based investors, the timing of Fed rate cuts affects yen-based returns on US assets through hedging costs. US CPI 2.7% suggests those costs may stay elevated until mid‑year. Partial hedging or flexible hedge ratios can help balance currency swings while keeping core exposure to US stocks.
US consumer demand should hold if the economy slows gradually. Exporters with dollar revenues can benefit, while defensives and cash-rich tech remain core. Domestic Japan holdings with overseas sales can diversify income streams. We favor names with low leverage and stable margins as policy uncertainty eases only slowly.
We would keep dollar-cost averaging in global equities, tilt to quality and free cash flow, and maintain some dry powder for pullbacks. Short-duration yen assets can anchor liquidity. If you hedge currency, review tenors and costs quarterly to reflect the path toward mid‑year policy shifts.
Technical setup for the S&P 500
RSI at 57.5 is constructive but not stretched, while Stochastic at 87 and Williams %R near -18 signal near-term overbought risk. MACD is above its signal with a positive histogram, supporting buyers on dips. Overall, momentum is firm, yet late-session softness can appear around resistance.
Bollinger Bands show the upper band near 6,980, middle around 6,866, and lower near 6,752. ATR near 59 points implies typical daily swings of that size. ADX around 12 signals a weak trend, so range trading may dominate. A clean close above 6,980 opens 7,000+, while 6,866 and 6,752 are supports.
Catalysts and how to act
Focus on inflation updates, PCE trends, and Fedspeak guiding the run-up to mid‑year. US CPI 2.7% keeps the bar high for early cuts, which supports a patient stance. Background on the inflation path is summarized by Kabutan.
Use a playbook that favors staged buying near support and trims near resistance. Keep a modest cash buffer, review hedge ratios, and track Fed funds futures for shifts in June cut odds. Rebalance quarterly to keep quality leaders at target weights while limiting concentration risk.
Final Thoughts
Sticky US CPI 2.7% keeps the first Fed rate cuts priced for June, after Powell’s term ends. That delays policy support and leaves cash yields appealing in the near term. For Japan-based investors, this means focusing on quality, managing hedge costs, and staying patient with entries. Technically, resistance sits near 6,980, with supports at 6,866 and 6,752 as the index trades above key averages. We would dollar-cost average into leaders, maintain a small cash buffer, and reassess currency hedges quarterly. Watch inflation data, PCE, and futures pricing for confirmation that the mid‑year pivot is on track.
FAQs
Why does US CPI 2.7% push Fed cuts to June?
Inflation at US CPI 2.7% stays above the 2% target, so the Fed wants more proof of cooling before easing. Fed funds futures reflect this caution by pricing the first rate cut around June, after Powell’s term ends, rather than in the spring.
How does this affect Japanese investors holding US stocks?
A later pivot keeps US rates higher for longer, which can raise yen hedging costs and make cash more competitive short term. Consider partial hedges, focus on quality companies, and stagger purchases so you can add on pullbacks while managing currency risk.
Is the S&P 500 overbought now?
Momentum is firm but mixed. RSI near 58 is constructive, while Stochastic around 87 and Williams %R near -18 suggest short-term overbought conditions. Expect range trading unless price closes above 6,980. Buying near support and trimming into strength can help manage risk.
What should I watch to confirm a policy shift?
Track monthly CPI and PCE inflation, changes in Fed funds futures, and comments from Fed officials. If core inflation slows convincingly and futures bring forward cut odds, confidence in mid‑year easing will rise. That backdrop would favor extending equity risk gradually.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
