United States stock indices closed higher on Tuesday (Wednesday AEST) with two at record levels after inflation data raised hopes of another interest rate cut.
The S&P 500 and Nasdaq Composite finished at new peaks after the Labor Department said the consumer price index (CPI) rose 0.2% in July.
The Dow Jones Industrial Average rose 483.52 points or 1.10% to 44,458.61, the S&P 500 added 72.31 points or 1.13% to 6,445.76 and the Nasdaq put on 296.50 points or 1.39% to 21,681.90.
Bond yields fell, based on expectations the Federal Reserve Board will lower rates by 25 basis points in September.
The Labor Department's Bureau of Labor Statistics delivered a mixed report with U.S. consumer prices rising only marginally in July but underlying inflation posting its largest gain in six months due to higher costs for air fares and tariff-sensitive goods like furniture.
"The CPI data is supportive for equities overall, getting some good news with the Fed looking more on track to cut in September and potentially more transitory inflation," Goldman Sachs Asset Management Co-head of Client Portfolio Management, Fundamental Equities Katherine Bordlemay was quoted in Reuters story as saying.
Also supporting the market were strength in selected stocks like Alphabet, which rose 1.2% on news Perplexity had made a $34.5 billion offer to buy its Chrome browser, and Intel Corp, which jumped 5.6% after President Trump appeared to reverse his position that CEO Lip-Bu Tan should resign.
Bond yields fell at the shorter end, with two-year paper down 0.88% to 3.733% and five-year paper off by 0.31% to 3.821%.
