US Stocks Hold Steady as Inflation Remains Above Target

The US stock market held steady at the open on Wednesday after inflation data exceeded expectations. The Dow Jones Industrial Average gained 53 points, or 0.1%, while the S&P 500 was little changed and the Nasdaq Composite traded around the flatline.

Inflation remains above the Federal Reserve's target of 2% as the personal consumption expenditures price index rose 0.2% on a seasonally adjusted basis in July, pushing the annual inflation rate to 3.7%. This was 0.1 percentage point above the Dow Jones consensus estimate.

Nvidia is set to report its fiscal second-quarter earnings after the bell Wednesday, making the results a major focus for investors. The company's market capitalization exceeds $5 trillion, making it the largest S&P 500 company. Investors are looking for evidence that AI infrastructure spending remains strong enough to support Nvidia's rapid revenue growth.

The Federal Open Market Committee does not meet formally in August, giving officials more time before their next scheduled meeting on September 15-16. Markets are pricing in a roughly one-in-three chance of a rate move in September, with December currently offering the strongest probability for a rate hike.