Inflation Data Eases Rate Hike Fears as S&P500 and Nasdaq End Higher

The S&P500 and Nasdaq indices ended higher on Wednesday after inflation data came in as expected, alleviating fears of an earlier-than-expected rate hike by the Federal Reserve. The core CPI, which excludes food and energy, advanced 0.2% last month, with the overall annual inflation rate landing at 3.4%. This marginal slowdown in inflation rates was seen as a positive sign for investors.

The S&P500 ended 0.3% higher, while the Nasdaq 100 added 0.5%, and the Dow Jones Industrial Average marginally eased 0.04%. The Russell 2000, which tracks stocks with small market capitalizations, also added 0.6%. Several ETFs tracking benchmark indexes showed similar gains.

Among the key gainers was the VanEck Semiconductor ETF (SMH), which jumped 2% due to strength in Nvidia (NVDA), Micron Tech (MU), and ASML Holdings (ASML). The Vanguard Information Technology ETF (VGT) also gained 1%, led by a 10% jump in SpaceX (SPCX) stock.

Despite the positive inflation data, some experts remain cautious. Chris Zaccarelli at Northlight Asset Management noted that while the report had no surprises, it still gives the Fed more time to wait before making any rate hike decisions.