S&P 500 and Nasdaq Close at Record Highs on Tame Inflation Data

Wall Street stocks surged to fresh records Tuesday after US data showed stable inflation despite worries over President Donald Trump's tariffs, lifting expectations for Federal Reserve interest rate cuts. Major indices spent the entire session in positive territory, with both the S&P 500 and Nasdaq finishing at fresh records. "We're in a bull market," said Adam Sarhan of 50 Park Investments. "The bulls are strong and getting stronger." The Dow Jones Industrial Average finished up 1.1 percent at 44,458.61. The broad-based S&P 500 also gained 1.1 percent to 6,445.76, while the tech-rich Nasdaq Composite Index jumped 1.4 percent to 21,681.90. The consumer price index rose 2.7 percent from a year ago in July, the same rate as in June. While "core" inflation stripping out volatile food and energy segments accelerated from the month before, analysts described the report as largely in line with expectations. Analysts said the report confirmed expectations for a Fed interest rate cut, after the latest jobs data pointed to weakening in the labor market.

"Nothing potentially blocks the Fed from likely cutting interest rates in September though we still have one more inflation reading before that and one more jobs report," said Angelo Kourkafas, senior global investment strategist from Edward Jones. Kourkafas said it was still likely "premature" to conclude that there would be no major inflation impact from the tariffs. Large tech companies were generally higher with semiconductor company Micron Technology and Facebook parent Meta Platforms especially strong. Both piled on more than three percent. Boeing jumped 2.9 percent despite reporting lower commercial plane deliveries in July compared with June. However, the figures were still above those in the year-ago period. Intel rose 5.5 percent after CEO Lip-Bu Tan met with Trump, who praised the executive after previously calling for him to step down.