US stocks surge after latest inflation report shows progress on price hikes

Recently, progress on inflation appeared to be stuck or, at worst, reversing: A closely watched gauge of underlying price hikes — an index that excludes highly volatile categories — hadn’t budged for months.

On Wednesday, it got unstuck.

The closely watched core measurement of the Consumer Price Index slowed for the first time in months, according to Bureau of Labor Statistics data released Wednesday. That reading, coupled with some better-than-expected wholesale inflation data received on Tuesday, spurred optimism in the markets.

US stock futures spiked Wednesday morning, as the CPI report boosted traders’ hopes that the Federal Reserve will continue its rate-cutting campaign this year. Futures on the Dow rose by more than 600 points. Futures on the S&P moved up by 1.5% and Nasdaq futures were higher by 1.8%.