US Stocks Move Higher Following CPI Data, Warsh Comments

US stocks rose on Tuesday as investors parsed latest inflation data and Federal Reserve Chairman Kevin Warsh’s remarks.

(Bloomberg) — US stocks rose on Tuesday as investors parsed latest inflation data and Federal Reserve Chairman Kevin Warsh’s remarks. The S&P 500 Index advanced 0.3% at 12:00 p.m. in New York, rallying after Monday’s slump. The Nasdaq 100 Index climbed 1.1% following a recovery in South Korea’s memory giants, with gains from SK hynix Inc. and Samsung Electronics Co. helping lift peers in the US.

US consumer prices declined in June for the first time in six years, while a key gauge of underlying inflation was little changed. The data takes some pressure off the Fed to raise interest rates. Investors are now awaiting figures on producer prices due Wednesday.

“The market was expecting kind of a softer inflation read, and this number turned out to be a little bit softer than market expectations,” said Subadra Rajappa, head of US research at Societe Generale. “I think I’d be a bit more focused on PPI tomorrow that feeds into core PCE later on this month to get a better read of the Fed’s favorite measure of inflation, which is core PCE.” The CPI report was much better than expected, according to Bill Adams, chief US economist at Fifth Third Commercial Bank.

The report likely provides cover to hold rates steady at the next meeting, he said, adding that the outlook for inflation is less promising in July, with higher gas prices. “The June slowdown is particularly heartening since it follows April’s update to the CPI shelter component, which filled in survey data that went missing during last year’s government shutdown and made shelter prices look deceptively cool in late 2025 and early 2026,” he said. In a testimony before lawmakers, Warsh said the Fed has no tolerance for high inflation, restating a vow to tame price growth that has been elevated for five years.

The testimony was prepared prior to the release of consumer inflation data covering June. In geopolitical news, President Donald Trump backed away from his widely panned plan to impose a 20% charge on cargo shipments through the Strait of Hormuz. The interim peace agreement between the US and Iran has effectively collapsed.

American forces reimposed a naval blockade and launched another wave of airstrikes, while Tehran attacked more oil tankers sailing through the Strait of Hormuz. Brent crude surged to $85.21 a barrel as a result, its highest level in more than a month. Among single-stock moves, JPMorgan Chase & Co. rose 2.0% after it reported its highest quarterly profit ever as stock traders blew past analysts’ estimates.

Wells Fargo & Co. fell after reporting results while Bank of America Corp. shares climbed. Goldman Sachs Group Inc. rose after beating expectations on equities sales and trading revenue for the second quarter. Outside of the banks, International Business Machines Corp. slumped 25% after reporting preliminary quarterly sales that missed analyst estimates.

Sectors in Focus - Shares of software and IT services companies plunged Tuesday after International Business Machines reported preliminary results that missed analyst expectations, reigniting questions about the sector. - Medical equipment and device makers are sliding in Tuesday trading after hospital operator HCA Healthcare Inc. posted preliminary results for the second quarter that highlighted weaker-than-expected volume for surgeries. - Clean energy stocks are rising on Tuesday as Truist Securities initiated coverage of the sector as he sees the firms benefiting from a strong increase in power demand.