by Caroline Valetkevitch

NEW YORK (Reuters) – The New York Stock Exchange ended sharply higher on Tuesday, with the Nasdaq gaining more than 2%, while data on inflation in the United States fueled speculation that the monetary tightening cycle of the Federal Reserve (Fed).

The Dow Jones index gained 1.43%, or 489.83 points, to 34,827.70 points.

The broader S&P-500 gained 84.15 points, or 1.91%, to 4,495.70 points.

The Nasdaq Composite advanced 326.64 points (2.37%) to 14,094.38 points.

The S&P-500 and the Nasdaq recorded their largest daily percentage increase since April 27.

Data released today showed that U.S. consumer prices remained stable last month, with fuel prices falling, while the annual rise in core inflation was the smallest in two years.

Investors are also keeping a close eye on the negotiations in the American Congress in order to avoid a “shutdown” (partial closure of American administrations) starting Friday evening.

According to Quincy Krosby, chief strategist at LPL Financial in Charlotte, today’s moves on Wall Street are a “direct response to the consumer price report that suggests the Fed may be finished (its rate hikes), although “There are questions about whether the Fed can declare victory or not.”

The American central bank raised its key rate by 525 basis points as part of a cycle of monetary tightening that began in March 2022 to stem galloping inflation.

Among the main sectors of the S&P-500, real estate and utilities, sensitive to interest rates, increased by 5.3% and 3.9% respectively, representing records since November 2022.

On the value side, Snap jumped 7.5% after information according to which Amazon will allow American users of the social network to purchase products put on sale by the online commerce giant directly on the platform.

Home Depot gained 5.4% after beating expectations for its quarterly profit.

( Jean Terzian)

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