US stocks steadied on Wednesday, eyeing new highs as a weak consumer price reading fueled hopes that the Federal Reserve may cut interest rates sooner than expected.
Dow Jones Industrial Average futures (YM=F) rose about 0.4%, while S&P 500 futures (ES=F) rose 0.5%. Futures on the Nasdaq 100 (NQ=F) rose 0.4% following a new peak for technology stocks.
As Yahoo Finance’s Allie Canal reported, the CPI rose 0.3% MoM and 3.4% YoY in April, a slowdown from March. “Core” inflation – which does not include the cost of food and gas – rose at its slowest annual pace in 2024.
Stocks rose on renewed confidence that the U.S. economy is in good enough shape for the Federal Reserve to begin cutting interest rates from their current historic highs. This optimism has led to a renewed bullish trend in the market.
Elsewhere on the macroeconomic front, retail sales fell steadily – exactly – last month, well below Wall Street expectations. The report may raise new questions about the health of American consumers.
Read more: How does the labor market affect inflation?
Meanwhile, the pace has slowed in a frenzied meme stock rally that saw GameStop (GME) and AMC (AMC) prices more than double at one point on Tuesday. Both stocks fell more than 10% in pre-market trading.
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