U.S. Stocks Steady Near Record Highs After Positive Inflation Data

U.S. stock indexes hovered near their all-time highs on Wednesday after a report showed wholesale inflation slowed more than economists anticipated. The S&P 500 remained largely unchanged in early trading, just below its record set last week, while the Dow Jones Industrial Average rose 0.1% and the Nasdaq composite edged down by 0.1% from its recent peak.

Bond yields declined, with the 10-year U.S. Treasury yield falling to 4.45% from 4.50% the previous day, as investors reacted to the inflation data. The report offered some relief following concerns that tariffs imposed by President Donald Trump were raising prices for U.S. consumers on imported goods such as toys and apparel.

ASML, a major supplier of chipmaking equipment, warned that it could not guarantee growth in 2025, citing rising macroeconomic and geopolitical uncertainty, including tariffs. CEO Christophe Fouquet said in a video statement that "the level of uncertainty is increasing, mostly due to macroeconomic and geopolitical consideration. And that includes, of course, tariffs." ASML shares trading in the U.S. fell 10.8%.

Several U.S. banks reported stronger-than-expected quarterly profits, helping to offset declines in other sectors. PNC Financial Services Group rose 1.5% after reporting loan growth despite what CEO Bill Demchak described as "an uncertain macro environment." Bank of America and Goldman Sachs also reported better-than-expected earnings, though their shares fluctuated.

Johnson & Johnson shares climbed 4.4% after the company exceeded analysts' sales and profit forecasts and raised its full-year outlook. CEO Joaquin Duato said the company anticipates "game-changing approvals and submissions" in the second half of 2025 for products targeting lung and bladder cancer.

Online firearms retailer GrabAGun experienced volatile trading on its first day after merging with Colombier Acquisition Corp. II and listing under the ticker "PEW." Donald Trump Jr. will join the company's board. The stock saw sharp swings, including a 19% early gain followed by a 31% drop before stabilizing.

Internationally, stock indexes were mixed. Jakarta's market rose 0.7% after President Trump announced a lower 19% tariff on Indonesian imports, down from a previously threatened 32%, following a trade agreement. Indonesia's central bank also cut its key interest rate by 0.25 percentage points to 5.25%. Indonesian President Prabowo Subianto told reporters, "We have calculated everything and discussed everything. The most important thing for me is my people, as I must protect the interests of our workers."

The latest inflation data may increase the likelihood that the Federal Reserve will consider cutting interest rates later this year. Fed Chair Jerome Powell has stated he wants to see more information on how tariffs are affecting the economy and inflation before making any decisions.