US stocks test record on inflation data

A sharp technology-led rally has lifted the U.S. stock market to record peaks, with the S&P 500 posting its first all-time closing high in two months. The benchmark index gained 5.75% over a four-session stretch, its biggest four-day surge since April 2025, propelled by tech and semiconductor shares. Calming of U.S.-Iran tensions and a pullback in oil prices also buoyed stocks. However, the rally will be tested next week by fresh inflation data, particularly the July CPI report due on Wednesday, which could build the case for the United States — Federal Reserve to raise interest rates. Economists expect CPI to rise 3.4% year-over-year and core CPI to rise 2.5%. The Fed held rates steady at its last meeting, but three of twelve policymakers dissented in favor of a hike, and markets are pricing in nearly a 60% chance of a rate increase in September. Treasury yields have risen on inflation concerns, with the 10-year yield recently pulling back to 4.67%. Oil price volatility is also being watched closely, as higher oil prices could increase inflation and the likelihood of Fed hikes. Upcoming reports include PPI, retail sales, and earnings from Applied Materials, Cisco, and CoreWeave. Semiconductor shares have driven the rally, with the Philadelphia Semiconductor Index up 70% in 2026 but still down more than 17% from its late-June high.