US close: S&P 500, Nasdaq hit new highs after CPI data and FOMC meeting

US stocks finished mostly higher on Wednesday with the S&P 500 and Nasdaq reaching new highs after data showed a larger-than-expected slowdown in inflation and the Federal Reserve gave more visibility around the interest-rate outlook.

The Dow closed down 0.1% at 38,712.21, while the S&P 500 gained 0.9% to a new peak of 5,421.03, while the Nasdaq finished 1.5% higher at an all-time high of 17,608.44.

Ahead of the opening bell, data from the Department of Labor showed that the consumer price index (CPI) was flat in May on seasonally adjusted terms – the first such occurrence since July 2022. Economists had pencilled in an increase of 0.1% after a 0.3% gain in April. In annual terms, the increase in headline CPI eased to 3.3% from 3.4% the month before, while the core rate fell to 3.4% from 3.6% – with both undershooting expectations by 0.1 percentage points.

Wall Street opened on the front foot following the data, with gains mostly held as the Federal Open Market Committee concluded its two-day policy meeting. As expected, the Fed chose to keep interest rates unchanged, but the 'Dot Plot' graph showed policymakers are now predicting just one rate cut in 2024, compared with earlier forecasts for three cuts.

"After the Fed meeting, the market is now pricing in a 55% chance of a rate cut in September, slightly lower than the 65% expected after the CPI report, and a 75% chance of a rate cut in December," said Kathleen Brooks, research director at XTB.

In the subsequent press conference, Fed chair Jerome Powell said Wednesday's CPI data was a "step in the right direction", but cautioned about getting too carried away "by any single data".

"Until we get the next main data print, the core PCE, that is due for release later this month, we may not see too much adjustment in financial markets. We think that interest rate expectations will stay around this level until the core PCE report," Brooks said.

The yield on a 10-year US Treasury note was down 8.5 basis points at 4.320% by the close of trade in New York.

Market movers

Apple shares gained another 3%, extending their stellar run following the announcement of the company's new Apple Intelligence AI system. The stock finished at the $213.07 mark, giving it a market capitalisation of $3.27trn, pulling back after touching a record high of $220.20 in afternoon trade which saw it briefly surpass Microsoft as the world's most valuable publicly listed company.

Also in the tech sector, Oracle surged 13% to its highest-ever level after announcing partnerships with Google and OpenAI, with investors shrugging off worse-than-expected quarterly results.

Casey's General Stores managed to impress with its quarterly earnings and revenues, sending the convenience store stock up 17%, while semiconductor group Broadcom was on the rise ahead of its results due out after the closing bell.

Dow Jones - Risers

Apple Inc. (AAPL) $213.07 2.86%
Home Depot Inc. (HD) $344.14 2.51%
Microsoft Corp. (MSFT) $441.06 1.94%
Goldman Sachs Group Inc. (GS) $448.70 1.00%
Caterpillar Inc. (CAT) $328.73 0.43%
Dow Chemical Co. (DOW) $56.25 0.18%
Amgen Inc. (AMGN) $301.08 0.13%
McDonald's Corp. (MCD) $254.56 0.08%
Dowdupont Inc. (DWDP) $0.00 0.00%
Walt Disney Co. (DIS) $100.80 -0.07%

Dow Jones - Fallers

Walgreens Boots Alliance, Inc. (WBA) $15.54 -2.45%
Nike Inc. (NKE) $93.79 -2.28%
Salesforce.Com Inc. (CRM) $235.80 -2.15%
Verizon Communications Inc. (VZ) $39.77 -1.61%
Visa Inc. (V) $270.34 -1.58%
Boeing Co. (BA) $182.67 -1.53%
JP Morgan Chase & Co. (JPM) $191.53 -1.46%
Chevron Corp. (CVX) $154.22 -1.45%
Procter & Gamble Co. (PG) $165.28 -1.37%
Merck & Co. Inc. (MRK) $130.38 -1.24%

S&P 500 - Risers

Oracle Corp. (ORCL) $140.38 13.32%
Skyworks Solutions Inc. (SWKS) $102.64 6.67%
Whirlpool Corp. (WHR) $94.05 6.22%
Equifax Inc. (EFX) $243.72 5.76%
Sl Green Realty Corp. (SLG) $55.56 5.65%
Autodesk Inc. (ADSK) $223.02 5.45%
Align Technology Inc. (ALGN) $265.89 4.98%
Comerica Inc. (CMA) $48.61 4.70%
Northern Trust Corp. (NTRS) $83.56 4.66%
Intuit Inc. (INTU) $592.22 4.50%

S&P 500 - Fallers

Amphenol Corp. (APH) $68.69 -48.90%
Illumina Inc. (ILMN) $108.51 -3.62%
Valero Energy Corp. (VLO) $148.40 -3.40%
Marathon Petroleum Corporation (MPC) $168.94 -3.27%
Estee Lauder Co. Inc. (EL) $114.02 -3.04%
Progressive Corp. (PGR) $202.41 -2.90%
Accenture Plc (ACN) $285.73 -2.89%
Monster Beverage Corp (MNST) $49.77 -2.72%
HF Sinclair Corporation (DINO) $52.06 -2.60%
General Mills Inc. (GIS) $65.29 -2.52%

Nasdaq 100 - Risers

Skyworks Solutions Inc. (SWKS) $102.64 6.67%
Autodesk Inc. (ADSK) $223.02 5.45%
Align Technology Inc. (ALGN) $265.89 4.98%
Intuit Inc. (INTU) $592.22 4.50%
Micron Technology Inc. (MU) $140.75 4.21%
Tesla Inc (TSLA) $177.29 3.88%
Lam Research Corp. (LRCX) $1,037.63 3.79%
KLA-Tencor Corp. (KLAC) $827.81 3.71%
Cadence Design Systems Inc. (CDNS) $311.70 3.61%
Nvidia Corp. (NVDA) $125.20 3.55%

Nasdaq 100 - Fallers

Illumina Inc. (ILMN) $108.51 -3.62%
Monster Beverage Corp (MNST) $49.77 -2.72%
T-Mobile Us, Inc. (TMUS) $173.79 -2.58%
Walgreens Boots Alliance, Inc. (WBA) $15.54 -2.45%
Mondelez International Inc. (MDLZ) $66.10 -2.19%
Kraft Heinz Co. (KHC) $32.92 -2.17%
Paypal Holdings Inc (PYPL) $63.43 -2.07%
Workday, Inc. (WDAY) $210.93 -1.49%
Comcast Corp. (CMCSA) $37.83 -1.28%
Vertex Pharmaceuticals Inc. (VRTX) $475.82 -1.19%