U.S. stocks move toward records as inflation eases and oil prices fall

TDT | Manama

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U.S. stocks moved closer to record highs on Thursday as easing inflation and lower oil prices boosted investor confidence, while falling Treasury yields added further support to equities.

The S&P 500 gained 0.5%, putting it on track to challenge the record reached the previous week. The Nasdaq Composite rose 0.6%, while the Dow Jones Industrial Average slipped 123 points, or 0.2%, by late morning.

Investor sentiment improved after data showed U.S. wholesale prices increased 4.7% in July from a year earlier, down from 5.5% in June and slightly below economists' expectations. The figures followed a similar easing in consumer inflation reported a day earlier.

The softer inflation readings reduced expectations of another Federal Reserve interest-rate increase in September. Traders were pricing in about a 34% chance of a rate hike, down from roughly 50% two days earlier. Such an increase would be the Fed's first in more than three years.

The 10-year Treasury yield fell to 4.64%, compared with 4.68% on Wednesday. Lower yields can make stocks more attractive while reducing borrowing costs.

Oil prices also supported markets, with Brent crude falling 1.1% to $88.03 a barrel amid continued geopolitical uncertainty.

Real-estate stocks performed strongly, with AvalonBay Communities gaining 2.5% and Builders FirstSource rising 1.3%. Fossil Group climbed 4% following better-than-expected results, while Cisco Systems dropped 8.6%.

Overseas, South Korea's Kospi jumped 3.6%, helped by technology and AI-related stocks.