Wall Street hits records following an encouraging update on inflation

Market Overview - U.S. stocks reached record highs, with the S&P 500 rising 0.8%, the Dow Jones Industrial Average increasing by 472 points (1%), and the Nasdaq composite climbing 1.1% [1] - The positive inflation data suggests potential relief for lower- and middle-income households and may enable the Federal Reserve to continue cutting interest rates to support the slowing job market [2][3] Federal Reserve Actions - The Federal Reserve recently cut its main interest rate for the first time this year, but has been cautious about further cuts due to concerns that lower rates could exacerbate inflation [3] - Following the inflation report, traders are increasingly confident that the Fed will cut rates in its next two meetings, including one scheduled for next week [3] Economic Concerns - There have been concerns regarding the labor market and inflation, with Fed officials currently prioritizing labor market conditions over inflation [4] - Recent stock market fluctuations have raised questions about valuations, as the S&P 500 has surged 35% since April, outpacing corporate profit growth [4] Company Performance - Ford Motor Company saw a significant increase of 12.2% in its stock price after exceeding analysts' profit expectations for the latest quarter, indicating strong business performance [6] - Intel's stock rose by 0.3% following a quarterly profit that surpassed analysts' expectations, with the CEO attributing this success to the booming demand for artificial intelligence [7]