Global stocks hold gains after in-line US CPI

Global stocks maintained their upward momentum on Wednesday following U.S. inflation data that remained consistent with expectations. The Consumer Price Index (CPI) increased by 0.1% last month, following a 0.4% decline in June, in line with a Reuters poll of economists and analysts. Annual CPI inflation declined to 3.4% from 3.5% in the previous month.

Federal Reserve Chair Kevin Warsh has expressed a desire not to provide any forward guidance, implying a relatively sanguine market reaction to the latest figures, according to Richard Carter, head of fixed interest research at Quilter Cheviot. Traders placed a 55% chance on the Federal Reserve keeping its policy rate within the 3.50%-3.75% range at the upcoming meeting.

U.S. stock futures, specifically the S&P 500 e-minis, rose by 0.4%, maintaining their gains. Nasdaq futures experienced an 0.8% increase, fueled by positive results from AI cloud company CoreWeave. Across Europe, the STOXX 600 index expanded by approximately 0.2%. Major stock indexes in Frankfurt, Paris, and London also saw modest gains between 0.1% and 0.4%.

In Asia, stocks climbed by 0.9%, with South Korean (Kospi) and Japanese and Taiwanese markets rising sharply. Regarding the Iran conflict, markets are still monitoring negotiations aimed at ending the war and reopening the Strait of Hormuz to shipping. A senior Iranian source stated that there were no discussions between Iran and the U.S. to extend their ceasefire, as Tehran views the agreement as lacking a starting date and, therefore, nothing to extend.

Despite this lack of progress, investors remain optimistic, as global stock indexes are nearing record highs.