FX.co ★ U.S. Mostly Higher Ahead Of Key Inflation Data

On Wednesday, stocks largely trended upwards, with major indices advancing after a narrowly mixed previous session. This movement led the Nasdaq and the S&P 500 to achieve new intraday record highs.

Currently, the Nasdaq has increased by 79.13 points or 0.4 percent to reach 18,508.42, the S&P 500 has risen by 17.68 points or 0.3 percent to stand at 5,594.66, and the Dow has gained 59.83 points or 0.2 percent, bringing it to 39,351.80.

This upward momentum on Wall Street is partly driven by gains in tech stocks following Taiwan Semiconductor’s (TSM) announcement of a significant surge in second-quarter sales, surpassing expectations.

Shares of Taiwan Semiconductor, a key supplier for major tech companies such as Nvidia (NVDA) and Apple (AAPL), have surged by 2.7 percent.

Despite the rises, overall trading activity remains somewhat muted as traders await the release of critical consumer price inflation data on Thursday.

Economists predict that annual consumer price growth will slow to 3.1 percent in June, down from 3.3 percent in May, with core consumer price growth expected to remain steady at 3.4 percent.

During congressional testimony, Federal Reserve Chair Jerome Powell highlighted that positive economic data would bolster the central bank's confidence that inflation is progressing towards its 2 percent target, potentially leading to an interest rate cut.

Powell also cautioned that maintaining elevated interest rates for an extended period could hinder economic growth.

"Considering the strides made in reducing inflation and cooling the labor market over the past two years, it’s not just elevated inflation that poses a risk," he noted. "Delaying or undercutting policy restraint could significantly weaken economic activity and employment."

Sector News

Gold stocks have shown a sharp increase, propelling the NYSE Arca Gold Bugs Index up by 2.7 percent to its highest intraday level in over a month.

This rally can be attributed to a rise in the price of gold, with August delivery futures climbing $15.20 to $2,383.10 per ounce.

Significant strength is also evident among semiconductor stocks, with the Philadelphia Semiconductor Index posting a 1.4 percent gain and reaching a new intraday record high.

Pharmaceutical and brokerage stocks are also displaying notable strength, whereas most other major sectors are experiencing more modest movements.

Other Markets

In overseas trading, the Asia-Pacific markets had a mixed performance on Wednesday. Japan's Nikkei 225 Index rose by 0.6 percent, while China's Shanghai Composite Index fell by 0.7 percent.

Conversely, major European markets experienced gains. The U.K.'s FTSE 100 Index increased by 0.6 percent, and both the German DAX Index and the French CAC 40 Index climbed by 0.9 percent.

In the bond market, treasuries showed little direction ahead of the forthcoming inflation data. Consequently, the yield on the benchmark ten-year note, which inversely correlates with its price, dipped by less than a basis point to 4.295 percent.