The S&P 500 and Nasdaq both hit record highs, driven by expectations of a Federal Reserve rate cut

According to relevant news, Wall Street is relatively calm, as inflation data in line with expectations has increased market speculation about a possible rate cut by the Federal Reserve in September, driving the stock market up, while short-term bond yields have declined.

All major sectors of the S&P 500 index have risen, with the index up 1.1%, reaching an all-time high. The Nasdaq 100 index also set a new historical high, while the Russell 2000 small-cap index rose 3%. Although the initial momentum of Treasury bonds weakened, the money market predicts a nearly 90% chance of a Federal Reserve rate cut next month, and the two-year Treasury yield fell 4 basis points to 3.73%. The dollar weakened.

The core inflation rate in the U.S. reached its highest level since the beginning of the year, but slow increases in commodity prices eased concerns about tariff pressures. In response, the market's renewed bets on low interest rates have fueled a stock market rally supported by the AI boom and strong corporate earnings.