The S&P 500 achieved another record close on Wednesday after wholesale prices unexpectedly declined, fuelling confidence that the Federal Reserve will ease policy again next week. Optimism was further lifted by a historic surge in Oracle, whose upbeat results reignited momentum across artificial intelligence and cloud-linked stocks. While the Nasdaq managed to hold record territory despite fading into the close, Apple’s drop dragged the Dow lower following an underwhelming product launch. Investors are now bracing for Thursday’s consumer price report, which could prove decisive in shaping the scale of the Fed’s upcoming move.

Key Takeaways:

  • Dow Ends Lower on Apple Drag: The Dow Jones Industrial Average fell 220 points, or 0.48%, to 45,490.92 as losses in Apple weighed after its latest iPhone launch failed to impress investors. 
  • S&P 500 Extends Record Run: The S&P 500 closed 0.3% higher at 6,532.04, securing a fresh record finish after briefly touching a new all-time intraday peak at 6,555.97. Gains were driven by a surprise fall in wholesale inflation and a surge in Oracle.
  • Nasdaq Treads Water at Record: The Nasdaq Composite edged up 0.03% to 21,886.06, setting a new closing high after earlier reaching an intraday record. While AI-related names provided support, afternoon profit-taking pared advances.
  • European Markets Mixed Despite US Boost: Europe’s main indices ended unevenly as investors weighed Wall Street’s gains against local developments. The Stoxx 600 slipped 0.05%, the FTSE 100 fell 0.19% to 9,225.39, and Germany’s DAX lost 0.39% to 23,632.95. In contrast, France’s CAC 40 rose 0.2% to 7,761, marking a third straight gain on optimism surrounding new Prime Minister Sébastien Lecornu, while Italy’s FTSE MIB dipped 0.12%. Corporate updates also influenced trading, with Novo Nordisk jumping 3.7% after announcing job cuts and Zara-owner Inditex surging 6.5% on upbeat trading commentary. Economic data also brightened the picture, with Italian industrial output climbing 0.4% in July against expectations for a contraction, while Portugal’s Q2 GDP rose 0.6% quarter-on-quarter, led by domestic demand and investment.
  • Asia Rallies as Fed Bets Rise: Asian markets advanced in step with Wall Street, lifted by expectations of US rate cuts and regional data. Japan’s Nikkei 225 gained 0.87% to a record 43,837.67, while the Topix added 0.6% to 3,140.97. South Korea’s Kospi rose 1.67% to 3,314.53, a fresh all-time high, with the Kosdaq up 0.53%. In China, the CSI 300 edged 0.21% higher to 4,445.36, while Hong Kong’s Hang Seng climbed 1.04% and the Hang Seng Tech index advanced 1.82%. Australia’s S&P/ASX 200 gained 0.31%, India’s Nifty 50 rose 0.56% and the Sensex gained 0.54%. Singapore’s Straits Times Index jumped more than 1% to a record 4,341.32. Indonesia’s Jakarta Composite Index rose 1.06% to recover from its prior session drop, while the rupiah strengthened 0.15% to 16,446. Taiwan’s Foxconn rose 1.2% and Samsung Electronics gained 1.4% after Apple’s latest product launch, though Apple itself slipped in US trade.
  • Oil Prices Rise on Geopolitical Tensions: Brent crude settled 1.66% higher at $67.49 a barrel, while WTI climbed 1.66% to $63.67 as an Israeli strike in Doha and heightened geopolitical risks spurred buying. However, gains were decreased by US data showing crude inventories unexpectedly rose by 3.9 million barrels, highlighting ongoing supply concerns.
  • US Wholesale Prices Dip Unexpectedly: The producer price index fell 0.1% in August versus expectations for a 0.3% rise, while core PPI also declined 0.1% against forecasts for a 0.3% increase. Excluding food, energy and trade, PPI rose 0.3%. Services prices dropped 0.2%, driven by a 1.7% slide in trade services, with goods up 0.1% as food rose 0.1% and energy fell 0.4%. 
  • Treasury Yields Ease on Inflation Data: The 10-year Treasury yield dipped more than 3 basis points to 4.04%, while the 30-year fell to 4.69% as softer PPI and a strong 10-year auction supported bonds. FedWatch implied a 100% probability of at least a quarter-point cut this month, with rising odds of a larger 50 bp move as traders positioned for further easing.

FX Today:

  • EUR/USD Pulls Back After Rejection Near 1.1750: EUR/USD closed at 1.1696, down 0.11%, after reaching a session high of 1.1730 and a low of 1.1683. The 50-day average at 1.1660 underpins near-term support, while the 100-day at 1.1537 and 200-day at 1.1082 continue to rise steadily. The pair has maintained a gradual uptrend since mid-August, though repeated failures above 1.1730–1.1750 cap bullish progress. Initial support sits at 1.1670, with deeper losses targeting 1.1620, while buyers need a close above 1.1750 to open the path toward 1.1800. For now, bias remains constructive while above the 50-day average, but upside momentum is stalling.
  • GBP/USD Holds Steady in Choppy Range: GBP/USD ended little changed at 1.3530, up 0.02%, after trading between 1.3513 and 1.3565. The small-bodied candle reflected ongoing indecision, as price continues to hover around the 50-day average at 1.3468, with the 100-day at 1.3464 and 200-day at 1.3079 lending broader support. Despite this constructive backdrop, repeated stalls at 1.3550–1.3600 keep upside capped, while firm demand around 1.3450 underpins the base. A daily close below 1.3440 would weaken this floor and expose 1.3400, while a break above 1.3600 is required to tilt momentum decisively higher. 
  • USD/JPY Stays Rangebound Around 147.50: USD/JPY closed at 147.46, up 0.04%, after posting a high of 147.64 and a low of 147.09. The small daily candle highlighted muted momentum as the pair remains locked between 147.00 and 148.00. The 50-day average at 147.49 is acting as a pivot, while the 100-day at 145.96 and 200-day at 148.70 frame the broader consolidation. Bulls have struggled to clear the 200-day average, while dips remain supported above 146.00, leaving the pair stuck in a tightening band. Immediate support lies at 146.80 and 146.00, with resistance at 148.00 and 148.70. 
  • USD/CHF Stabilises Near 0.8000 But Trend Still Weak: USD/CHF closed at 0.7992, up 0.32%, after trading between 0.7956 and 0.7995. Price is still capped beneath all major moving averages, with the 50-day at 0.8019, the 100-day at 0.8111, and the 200-day at 0.8489 all trending lower. Structurally, the pair has tested the 0.7900 area several times, forming a floor that limits declines for now. A close under 0.7880 would reopen the path toward 0.7800, while resistance between 0.8050 and 0.8080 must be reclaimed to shift momentum. Sellers remain in control overall, with rallies likely to be short-lived.
  • AUD/USD Extends Recovery Toward Resistance Zone: AUD/USD settled at 0.6613, up 0.44%, after a session high of 0.6636 and low of 0.6580. The 50-day average at 0.6619 acts as immediate resistance, while the 100-day at 0.6492 and 200-day at 0.6388 trend higher beneath, reinforcing the constructive medium-term setup. Demand around 0.6480–0.6500 has provided a strong base since mid-August, underpinning the latest advance. Support now lies at 0.6580, with stronger interest at 0.6540. A decisive close above 0.6640 would open 0.6680, while failure to clear resistance may trigger renewed consolidation.
  • Gold Holds Above $3,630 After Record Surge: Gold closed at $3,639, up 0.45%, after swinging between $3,619 and $3,657. Moving averages remain strongly supportive, with the 50-day at $3,386, the 100-day at $3,354, and the 200-day at $3,095 all trending higher. Gold has established higher highs and higher lows, maintaining firm upward momentum, though the shorter candles near $3,650 suggest a pause. Initial support lies at $3,600, with stronger demand around $3,560. A sustained close above $3,660 would target $3,700, keeping the outlook bullish while above $3,600.

Market Movers:

  • Oracle Soars on AI-Driven Cloud Growth: Oracle surged more than 35%, its best day in decades, after reporting explosive multicloud database demand and unveiling a long-term revenue forecast far ahead of expectations.
  • AI Infrastructure Stocks Rally on Oracle Boost: Broadcom jumped over 9%, CoreWeave 17%, and Arista Networks more than 6% as Oracle’s results reinforced surging demand for AI computing capacity, also lifting Nvidia, AMD and Super Micro.
  • Energy Providers Gain on AI Power Demand: Vertiv rose more than 9% and Vistra 8%, while Constellation Energy and GE Vernova added over 6%.
  • Travere Therapeutics Jumps on FDA Update: Travere surged more than 26% after regulators scrapped the need for an advisory committee review of its kidney disorder drug application, clearing a major hurdle.
  • Synopsys Plunges on Weak Guidance: Synopsys tumbled more than 35% to lead Nasdaq and S&P 500 laggards after cutting its earnings outlook sharply below Wall Street forecasts.
  • Chewy Drops on Post-Earnings Disappointment: Chewy slid 16% despite topping second-quarter estimates, as analysts flagged that results failed to surpass already high investor expectations.
  • Apple Sinks on Tepid Product Launch: Apple fell over 3% as investors reacted coolly to its latest iPhone, watch and AirPods unveiling, overshadowing gains in its Asian supply chain partners.

Markets drew support from the surprise fall in US wholesale prices, which highlighted the view that inflationary pressures are cooling and strengthened the case for near-term Fed rate cuts. The rally in technology shares, led by Oracle’s record-breaking advance, highlighted how AI remains a dominant theme for investors, even as broader market participation was uneven. With Treasury yields softening and oil climbing on geopolitical risk, global sentiment is finely balanced heading into Thursday’s CPI release. That report will determine whether the Fed has scope for a larger 50-basis-point cut and set the tone for market direction through the rest of September.