US stocks gain, led by Dow as investors look for rate insight
stocks were higher on Wednesday, with the Dow leading gains and the S&P 500 setting a closing record, paced drugmaker Merck, while investors looked towards the next piece of inflation data and Federal Reserve commentary for signals on the rate path.
Merck & Co advanced 4.96% as the best performer on the Dow after the U.S. Food and Drug Administration approved its therapy for adults suffering from a rare lung condition.
The blue-chip Dow now sits less than 1% away from breaking the 40,000 level for the first time.
Gains on the tech-heavy Nasdaq were held in check, however, by 2.5% decline in AI giant Nvidia, which lost ground for a second straight session. Shares were still up more than 80% on the year, however.
Recent data that showed hotter than expected inflation in the form of consumer prices (CPI) and producer prices (PPI) failed to markedly disrupt market expectations for a rate cut of at least 25 basis points (bps) from the Federal Reserve in June.
The Fed kept its projections for three rate cuts this year intact at its policy meeting last week, which central bank officials have largely stood by this week in comments.
The Personal Consumption Expenditures Price Index (PCE), the Fed's preferred inflation gauge, is due on Good Friday, when the U.S. stock market will be closed.
«The Fed can and should take its time, largely because the economy is affording them that flexibility with the strength that we're seeing, and that premature rate cuts only probably set us up for a more adverse outcome,» said Craig
