The Nasdaq 100 Index jumped more than 1% following inflation data that pleased the market

The Nasdaq 100 technology index rose more than 1% at the start of trading on August 12 following the release of July’s consumer price data, which was fully in line with forecasts. The broader Nasdaq Composite index rose 0.7%, the S&P 500 gained about 0.4%, and the Dow Jones Industrial Average rose 0.2%. The Russell 2000 index of small- and mid-cap companies rose 0.3%.

Inflation in the U.S. in June held no surprises: the U.S. Consumer Price Index (CPI) rose 3.4% year-over-year in July—following a 3.5% increase in June, according to the U.S. Bureau of Labor Statistics. On a monthly basis, prices rose by 0.1%. The core Consumer Price Index (Core CPI), which excludes volatile food and energy prices, rose 0.2% for the month after remaining flat in June and 2.5% year-over-year after 2.6% the previous month. The figures were fully in line with the FactSet consensus forecast cited by Morningstar.

Due to a slight easing of inflation, traders have lowered their estimates of the probability of an interest rate hike at the U.S. Federal Reserve’s September meeting. At the time of this writing, the FedWatch tool shows that the probability of the rate remaining unchanged in the 3.5–3.75% range stands at 59.6%. The probability of a 25-basis-point hike was estimated at 40.4%.

This article was AI-translated and verified by a human editor