WASHINGTON (dpa-AFX) - After showing a lack of direction early in the session, stocks moved mostly higher over the course of the trading day on Tuesday. The major averages added to the gains posted during Monday's session, reaching new record closing highs.
The major averages pulled back off their highs going into the close but remained in positive territory. The Dow increased 196.39 points or 0.4 percent to 45,711.34, the Nasdaq climbed 80.79 points or 0.4 percent to 21,879.49 and the S&P 500 rose 17.46 points or 0.3 percent to 6,512.61.
The strength that emerged on Wall Street may have reflected ongoing optimism about the outlook for interest rates ahead of the release of closely watched inflation data in the coming days.
The Labor Department is scheduled to release reports on producer price inflation and consumer price inflation on Wednesday and Thursday, respectively.
While last Friday's weaker-than-expected jobs data increased confidence the Fed will cut interest rates at its meeting next week, the inflation data could influence how aggressively the central bank lowers rates.
Economists currently expect the annual rate of producer price growth in August to come in unchanged from July at 3.3 percent.
The annual rate of growth by consumer prices is expected to accelerate to 2.9 percent in August from 2.7 percent in July, while the annual rate of growth by core consumer prices, which exclude food and energy prices, is expected to hold at 3.1 percent.
Ahead of the data, CME Group's FedWatch Tool is currently indicating a 91.8 percent chance the Fed will lower rates by a quarter point and a slim 8.2 percent chance of a half-point rate cut.
On the U.S. economic front, the Labor Department released data showing non-farm employment for the twelve months through March 2025 was downwardly revised by 911,000 jobs.
'The jobs picture keeps deteriorating and while that should make it easier for the Fed to cut rates this fall, it could also throw some cold water on the recent rally,' said Chris Zaccarelli, Chief Investment Officer for Northlight Asset Management.
'Worse still, if the CPI shows a worsening trend of higher inflation on Thursday then the market will begin worrying about stagflation,' he added. 'The bull market has been extremely resilient this year, but we could be approaching an inflection point where it is tested again.'
Sector News
Despite the advance by the broader markets, housing stocks have moved sharply lower on the day, with the Philadelphia Housing Sector Index plunging by 2.9 percent after ending Monday's trading at a nine-month closing high.
Substantial weakness was also visible among airline stocks, as reflected by the 2.0 percent slump by the NYSE Arca Airline Index.
Steel and gold stocks also moved to the downside on the day, while networking and banking stocks turned in strong performances.
Other Market
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.4 percent, while Hong Kong's Hang Seng Index jumped by 1.2 percent.
The major European markets also ended the day mixed. While the German DAX Index declined by 0.4 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both crept up by 0.2 percent.
In the bond market, treasuries gave back ground after moving notably higher over the past several sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.8 basis points to 4.074 percent.
Looking Ahead
The producer price inflation data is likely to attract attention on Wednesday, although trading activity may remain relatively subdued ahead of the release of the more closely watched consumer price inflation data on Thursday.
Copyright(c) 2025 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2025 AFX News
