Wall Street at record highs, attention shifts to July inflation

U.S. stock markets are set to close the week higher, with the Dow Jones and S&P 500 at new record highs. The Nasdaq 100 has recovered more than 10 percent from the low touched the previous week, a clear sign of recovery after a correction phase.

Among the factors supporting the rally is also the trend in bond yields: two-year Treasury yields fell to around 4.2 percent, a level considered favorable for stocks because it reduces the relative appeal of fixed-income securities compared with equity investment.

Indicator	Data
Dow Jones and S&P 500	new record highs
Nasdaq 100	+10% from the previous week’s low
2-year Treasury	yield around 4.2%

Looking ahead to the coming week, market attention is focused on the consumer price index (CPI) and producer price index (PPI) data for July, due to be released in the coming days. These are considered crucial data points for guiding the Federal Reserve’s interest rate decisions at its upcoming meetings.

Art Hogan, chief market strategist at B. Riley Wealth, noted that the U.S. central bank will have to take into account both of its institutional mandates at the same time: full employment and price stability. This reading frames next week’s inflation data not as an isolated element, but as part of a broader balance that the Fed must manage between economic growth and price control.

The combination of record highs on stock indices, the Nasdaq’s recovery and falling bond yields describes a market phase in which investors are pricing in favorable expectations about future monetary policy, awaiting confirmation or denial from the coming week’s macroeconomic data.