The S&P 500 and Nasdaq 100 advanced on Wednesday afternoon, while the Dow Jones hovered around the flat line, after softer-than-expected inflation data strengthened expectations that the Federal Reserve may refrain from raising interest rates as early as next month.
The PCE price index rose 0.3% in August, undershooting the 0.4% consensus forecast, while core PCE gained 0.2%, also below expectations of 0.3%. On an annual basis, headline PCE inflation came in at 3.4%, compared with market estimates of 3.7%. Following the release, futures markets were pricing in less than a 40% probability of a 25-basis-point rate hike in October.
Technology stocks led the advance, with Alphabet, Apple, and Microsoft each rising about 2%. Semiconductor shares also moved higher across the board, with Intel climbing as much as 3%.