Stocks advance as July CPI lands on forecast and September hike odds fade

by Tomas Ferreira · August 12, 2026

Markets Reporter, US Market Current

Wall Street got the inflation report it was hoping for on Wednesday morning, and equities responded with a broad if unspectacular advance. The Labor Department said consumer prices rose 0.1% in July on a seasonally adjusted basis and 3.4% from a year earlier, while the core measure that strips out food and energy rose 0.2% on the month and 2.5% on the year. Every one of those figures matched the consensus of economists polled by LSEG, according to Fox Business, removing the tail risk that had kept traders defensive for the better part of a week.

By late morning the S&P 500 was up 0.35% at 7,754 and the Nasdaq Composite had added 0.70% to 26,632, according to a market snapshot published by 24/7 Wall St. The Dow Jones Industrial Average was close to unchanged at 53,818 and the Russell 2000 sat at 3,029.17, both up 0.02%. Later in the session the picture firmed: the Sunday Guardian, citing intraday data, put the S&P 500 at 7,747.46, a gain of 19.51 points or 0.25%, with the Dow up 53 points at 53,845 and the Russell 2000 at 3,033.97, up 6.85 points. The S&P 500's record close remains 7,757.64, set on August 7.

Volatility drained out of the tape. The Cboe Volatility Index was quoted at 14.87, down 2.69%, per the Sunday Guardian's intraday snapshot, a level consistent with a market that has priced out an immediate policy shock. Yahoo Finance had earlier put the VIX at 15.19 in pre-market trade, with S&P 500 futures up 0.4% and Nasdaq 100 futures up 0.8% before the opening bell.

The rates market did most of the reinterpreting. Traders had spent the summer handicapping whether the Federal Reserve would resume raising rates in September, an unusual debate for a market that has spent years asking the opposite question. According to figures from CME Group's FedWatch tool cited by The Motley Fool, the implied probability of a quarter-point increase at the September meeting slipped from roughly 48% before the release to about 38% by 11:32 a.m. Eastern, while the odds of no change climbed from just under 52% to around 62%. The 10-year Treasury yield eased to 4.670%, down 0.64% on the day, the Sunday Guardian reported.

Commodities cut across the story. Gold extended a run that has become one of the year's defining trades, changing hands at $4,426.64 an ounce, up 1.29%, while West Texas Intermediate crude slipped 0.50% to $82.78 and Brent eased 0.39% to $88.56, according to the same intraday data. Energy prices have been the single largest contributor to the headline inflation rate over the past year even as they fell in July, a tension that has kept the Fed's hawkish minority engaged.

The session's most violent moves came from the artificial intelligence infrastructure complex, which reported earnings after Tuesday's close. CoreWeave surged 18.6% by midday Eastern, according to Yahoo Finance, after posting second quarter revenue of $2.58 billion and raising its full-year outlook. TheStreet's opening tally showed Nebius Group up 16.5% and Super Micro Computer up 9%, alongside a 16% jump for Cava Group and a 12% gain for H&R Block, both on earnings beats. Within the Dow, Intel added 3.72% to $101.34, Nvidia rose 2.94% to $223.88 and Cisco Systems gained 2.36% to $123.27 ahead of its own results, per the Sunday Guardian.

Not everything participated. Home Depot fell 2.67% to $345.01, IBM dropped 1.89%, Nike lost 1.53%, Microsoft slid 1.48% to $496.37 and Boeing eased 1.43%, the Sunday Guardian reported, a reminder that the rally remains concentrated in a narrow band of semiconductor and data center names rather than spread evenly across the blue chips. TheStreet also flagged declines of 6.5% in Neurocrine Biosciences on safety concerns, 4.5% in Performance Food Group after a miss and 4.2% in Cencora.

The calendar does not get quieter from here. Cisco was among the companies scheduled to report Wednesday, according to Yahoo Finance, and investors will get another employment report and another CPI print before the Federal Open Market Committee convenes in September. For now the market has settled on a story it can live with: inflation that is drifting lower rather than reaccelerating, a labor market soft enough to argue against tightening, and an AI capital cycle that has not yet shown signs of slowing.