Energy "Dominates" CPI, Watch VIX & Software Beatdown into Weekend

• January Headline CPI (M/M) was 0.2% (vs. 0.3% estimate) and (Y/Y) was 2.4% (vs. 2.5% estimate), indicating cooler-than-expected inflation.
• Energy prices, especially gasoline (down 7.5% Y/Y), were the primary drivers of the cooler CPI, with energy commodities down 3.3% and fuel oil down 5.7%.
• The 10-year Treasury yield decreased to 4.09%, and equity futures saw a positive turnaround, reflecting a generally positive macro outlook for the U.S. economy.

January's CPI report came in cooler than expected, largely due to a significant decline in energy prices, particularly gasoline. This led to a positive market reaction, with equity futures turning around from earlier lows. Despite some sector-specific pressures like in software, the overall macro economic data for the week, including unemployment and inflation, is viewed as positive, potentially influencing the Fed's future decisions.