Record highs for S&P 500 and Nasdaq as inflation data looms

Investors await inflation data and major earnings reports as S&P 500 and Nasdaq reach new peaks

Record highs for S&P 500 and Nasdaq as inflation data looms

The S&P 500 and Nasdaq closed at record highs on Monday as investors look forward to key inflation data for clues about the sustainability of this year’s market rally, according to CNBC.

Major financial and consumer companies are also set to release earnings.

The S&P 500 rose 0.1 percent to close at 5,572.85, while the Nasdaq Composite gained 0.28 percent, ending at 18,403.74. In contrast, the Dow Jones Industrial Average fell by 31 points, or 0.08 percent, to 39,344.79.

Optimism about easing inflation and economic weaknesses potentially leading to a Federal Reserve interest rate cut has driven the S&P 500 to its fourth positive week in the last five.

The June consumer price index, due on Thursday, could reinforce these expectations if it shows improvement. The producer price index data will be released on Friday.

Labour data from last week showed a slightly cooling jobs market, boosting hopes for a rate cut. Although more jobs were added in June than expected, the unemployment rate rose unexpectedly to 4.1 percent from 4 percent.

According to the CME FedWatch Tool, traders are expecting two interest rate cuts in 2024, with the first anticipated in September.

UBS strategist Vincent Heaney wrote in a Monday note, “We believe the fundamental backdrop remains supportive for equities, driven by solid economic and earnings growth, interest rate cuts, and rising investment in AI.”

PepsiCo and Delta Air Lines will release their results on Thursday, followed by major banks like Citigroup and JPMorgan Chase, which will kick off the second-quarter earnings season on Friday.