CPI beats on core, but tariff-driven headline inflation keeps bulls pinned below 735

Wednesday opens with a split verdict from this morning's inflation report: core CPI came in at 0.2% month-over-month, softer than the 0.3% estimate — a relief for rate-sensitive assets. But the headline inflation rate jumped to 4.2% year-over-year, up sharply from 3.8% prior, reflecting tariff pass-through that the market cannot easily dismiss.

S&P futures are flat overnight after a volatile globex session that swung from 7,491 down to 7,247 before stabilizing near 7,350 — a 243-point range that tells you the market is genuinely uncertain about what this print means. SPY pre-market sits at 733.13, barely above yesterday's close, while QQQ is softer at 701.36, still nursing losses from yesterday's 4.2% intraday range. The 0DTE expiration today adds a gravitational pull toward SPY's max pain and put wall, both sitting at 735 — just above current price.