S&P 500 opens at record high as Dow and NASDAQ climb after CPI data

The S&P 500 opened in record territory on August 12 after the Bureau of Labor Statistics delivered a CPI print that landed squarely on economists’ expectations. July headline inflation came in at 3.4% year-over-year, ticking down from 3.5% in June, while the month-over-month increase was a modest 0.1%.

Both the Dow Jones Industrial Average and the Nasdaq Composite followed suit, climbing in early trading as investors digested the numbers.

The numbers that moved the needle

Core CPI, which strips out volatile food and energy prices, rose 2.5% year-over-year. That’s the lowest reading since February 2026.

The data dropped at 8:30 a.m. ET, and futures markets had already been telegraphing optimism before the numbers hit screens. The S&P 500 had closed the prior session at 7,757.64, setting up the index to gap into fresh record territory once the inflation print confirmed what traders had been hoping for: that price pressures continue to moderate at a steady, non-alarming pace.

Futures for the Nasdaq and Dow also climbed following the S&P 500’s lead, pointing to broad-based gains rather than a rally concentrated in any single sector.

What the Fed is thinking (probably)

After a softer jobs report in recent weeks and now a CPI print showing continued disinflation, traders began pricing in reduced odds for imminent rate hikes. The consensus view shifted toward a Federal Reserve that’s more likely to hold steady than tighten further.

Core CPI at 2.5% is still above the Fed’s 2% target, so nobody is declaring victory on inflation just yet.

Context and what comes next

The S&P 500 has been grinding higher through a summer that featured its share of volatility, driven by a mix of inflation concerns, geopolitical uncertainty, and periodic bouts of investor anxiety about whether the economic cycle was turning. Strengthening corporate earnings helped provide a floor under prices, while recovering tech stocks supplied the upside momentum.

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