S&P500 and Nasdaq 100: Tech Surge Drives Indices Higher as Fed Eyes Inflation Drop

S&P 500 Edges Toward Record as Geopolitical Fears Ease and Fed Holds Course

The S&P 500 hovered just shy of a record at the mid-session on Wednesday, buoyed by cooling Middle East tensions and a cautious Federal Reserve stance that reassured markets. Optimism grew as the ceasefire between Israel and Iran, brokered by U.S. President Donald Trump, held up despite minor infractions. The easing geopolitical risk supported risk-on sentiment, especially in tech, pushing the Nasdaq 100 to an intraday high.

Fed Chair Jerome Powell’s second day of congressional testimony signaled a patient approach to rate cuts. He noted the central bank remains data-dependent, but a surprise drop in inflation or weakening labor market could bring forward easing. Traders now see a 70% chance of a 25-basis-point cut in September, with 60 basis points priced in by year-end, according to CME FedWatch.

How Did Indexes and Sectors React to the Ceasefire and Fed Testimony?

The S&P 500 gained 0.11% to 6,099.12, while the Nasdaq rose 0.36% to 19,984.48. The Dow lagged, slipping 0.11% to 43,043.63. Most S&P 500 sectors fell, led by real estate and utilities, each down 0.7%. In contrast, the tech sector jumped 1.1%, lifting broader indexes as investors rotated into growth names.

The market breadth was weak, with declining stocks outpacing advancers nearly 2-to-1 on both the NYSE and Nasdaq. Still, the S&P 500 notched 20 new 52-week highs, while the Nasdaq posted 70.

Which Stocks Moved on Earnings and Sector News?

FedEx dropped 2.9% after guiding below consensus on quarterly profits, blaming tariffs for softer global demand. General Mills fell nearly 3% as it issued a lower-than-expected full-year profit outlook.

On the upside, Nvidia climbed 2.6%, extending its leadership in the AI-driven rally. Coinbase also rose 2.6% after Bernstein hiked its price target to a Street high. BlackBerry soared 17.4% on stronger revenue guidance, fueled by steady demand for cybersecurity solutions. Tesla slid 4.3% following another month of declining European sales.

What Are Traders Watching Next?

Thursday’s final Q1 GDP print and Friday’s PCE inflation data are front and center. Traders are particularly focused on whether tariff-driven price increases are translating into sticky inflation or slowing consumer demand. The Fed’s next moves hinge on these outcomes, and any sign of economic softening could bolster the case for September rate cuts.

With geopolitical risk receding and central bank policy entering a data-sensitive phase, traders should brace for volatility tied to upcoming macro releases and earnings guidance revisions.

More Information in our Economic Calendar.