Here’s a question on the minds of investors amid recent hotter-than-anticipated inflation readings and this powerful rally: Are we due for a stock market scare? The S & P 500 has shot up over 25% since the late-October lows. The ascent came as investors raised their expectations for faster declines in the rate of inflation and anticipated speedy and deep rate cuts from the Federal Reserve. However, as of late, there have been some early warning signs that the declines in inflation may be slowing. Perhaps they may even be reversing a bit, as the last two consumer price index reports have suggested. It’s true that seasonal factors may have played a role in the recent CPI readings. It’s also true that much of the price increases have come from areas over which the Fed has little control, such as auto and health insurance. Producer prices, reported Thursday morning, came in considerably higher than expected, including both the headline reading of 0.6% on the month and the underlying core measure of wholesale inflation. Other areas have also sent up some flags that could adversely affect stocks and bonds in the short run. Measures to watch Consumer inflation expectations , as measured by the New York Federal Reserve, have jumped when it comes to looking ahead to the next three to five years. Similarly, the New York Fed’s so-called Multivariate Core Trend model , a fine-tuned measure of underlying inflation, has turned upward, now estimating core inflation at 3.04%, compared to a low of 2.46% in November 2023. Further complicating matters is the recent rise in both oil and gasoline prices. West Texas Intermediate crude oil futures moved above $80 per barrel on Thursday, owing to Ukraine’s escalating attacks on Russian oil refineries, as well as continued violence in the Middle East and OPEC’s persistent production cuts. The rise in gasoline futures , which had at one point slipped below $2.00 a gallon in December 2023, are sitting at around $2.69 a gallon. Coupled with the continued high costs for groceries, this means consumers will feel a pinch from those two sensitive prices in the weeks and months ahead. The bright spot on the energy front has been the persistent drop in natural gas, the feedstock for power generation and heating or cooling our homes. That price has remained stuck at historically low levels, offering some price relief on that front. Having said that, other commodity prices, from copper to corn, have also turned higher in recent weeks threatening the continuation of the “immaculate disinflation” we’ve seen over the past many months. That means the Fed may be forced to delay any rate reductions until this pop in prices reverses course, potentially denting plans for a May or June cut. Could slowing growth temper the bump in prices? It is possible that this is entirely a temporary phenomenon and as economic growth invariably slows, those pressures may ease. The Atlanta Federal Reserve’s GDPNow forecast pegs first-quarter growth at an annual rate of 2.3%, down from earlier estimates. Payroll growth was also revised downward in December and January , showing some loosening of the labor market. This could portend weakening economic growth in the months to come. Of course, that could lead to a return to lower inflation and subsequently speed up the timetable for the Fed’s expected rate cuts. I’m not at all abandoning my view that inflation will continue to fall, that the Fed will cut rates three times this year and growth will moderate, leaving the “Goldilocks scenario” intact for the remainder of 2024. However, it is unwise to ignore what market signals are suggesting, at least in the short run. Noted economist John Maynard Keynes once said, “In the long run, we are all dead,” which is true. But in the short run, we should remain on heightened alert for changes in this year’s outlook. There is another famous saying: “When the facts change, I change my mind. What do you do, sir?” I’m not ready to change my mind, but I’m open to the possibility. The markets are telling me that I should be. — CNBC contributor Ron Insana is chief market strategist at Dynasty Financial Partners .