US Indices Hit Fresh Records on Cool CPI – US Market Wrap

Wall Street traders sent stocks to all-time highs as bond yields fell after an inflation slowdown reinforced expectations that the Federal Reserve will cut interest rates as early as September.

The S&P 500 set its 23rd record in 2024, as data showed the consumer price index fell for the first time in six months. Wall Street’s “fear gauge” – the VIX – fell to its lowest level since December. Treasuries rose across the US curve. Fed swaps predict a faster rate of policy easing this year. The dollar weakened against all of its developed-market peers.

The latest inflation report may give US policymakers hope that inflation is resuming its downward trend, allowing them to cut interest rates. Separate retail sales data showed a softening of the resilient consumer demand that has been supporting the economy.

The core CPI, which excludes food and energy costs, increased 0.3% from March, breaking a three-month streak of above-forecast readings that raised concerns about inflation becoming entrenched. The year-over-year rate fell to its slowest in three years.

The majority of major groups in the S&P 500 advanced, with the index rising 1.2% to 5,300. Nvidia led a rally among chipmakers. Homebuilders jumped. The meme rally, which increased GameStop and AMC Entertainment Holdings’ value by about $11 billion, fizzled.