A benign December inflation report was all it took to ignite another strong rally on Wall Street, with major indices delivering their best weekly performance since the post-election surge in early November.

Heading into the week, markets were gripped by concerns over inflation and interest rates, pricing in just one rate cut by year-end while the 30-year Treasury yield hovered around 5%.

Fresh data showed inflation rising for the third straight month up to 2.9%, yet right in line with forecasts. A softer core reading — excluding food and energy — gave traders hope that the Fed might cut rates at least twice this year.

Adding fuel to the bull run, major banks kicked off the fourth-quarter 2024 earnings season with blowout results.

Financial stocks — as tracked by the Financials Select Sector SPDR Fund (NYSE:XLF) — jumped 6% for the week, their best rally since October 2023. Goldman Sachs Group Inc. (NYSE:GS) led the charge among big players, surging 11% to hit record highs.

In commodities, oil briefly touched $80 per barrel before retreating after the approval of a ceasefire deal in Gaza between Israel and Hamas.

In cryptocurrency markets, Bitcoin (CRYPTO: BTC) continues to defy gravity, surpassing $100,000, fueled by optimism over crypto-friendly policies under the incoming Donald Trump administration.

Trump will officially take office as the 47th U.S. president on Monday.

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