US stocks close at record high on rate cut bets

US stocks climbed to a record high on Tuesday, following inflation data that strengthened expectations of a Federal Reserve rate cut this year.

At Friday’s close, the Dow Jones Industrial Average rose 1.10%, or 483 points, to 44,458.

The S&P 500 gained 1.15%, or 72 points, to 6,445, marking its 16th record close so far this year.

The Nasdaq Composite climbed 1.40%, or 296 points, to 21,681, posting its 19th record close of the year.

The Stoxx Europe 600 rose 0.2% to 547.89 at the close, with most major sectors and bourses advancing.

France’s CAC 40 added 0.7% to 7,753, while the UK’s FTSE 100 rose 0.2% to 9,147. Germany’s DAX, however, slipped 0.25% to 24,024.

Japan’s Nikkei 225 advanced 2.15% to 42,718, while the broader Topix jumped 1.4% to 3,066, with both indexes closing at record highs.

Brent crude futures for October delivery fell 0.8%, or 51 cents, to settle at $66.12 a barrel.

US WTI crude futures for September delivery dropped 1.25%, or 79 cents, to $63.17 a barrel.

December futures for the yellow metal slipped 0.2%, or $5.70, to $3,399 an ounce.

Data released on Tuesday showed that the US core consumer price index (CPI) rose to 3.1% last month from 2.9% in June, compared with expectations of 3%.

Headline inflation held steady at 2.7% year-on-year (YoY), versus forecasts of 2.8%, while the monthly readings for both the core and headline indices matched estimates.

Following the data, the FedWatch tool indicated a 94% probability of a 25-basis-point rate cut in September, a 61% chance of another cut of the same size in October, and a 51% chance of a third cut in December.