S&P500 Forecast: Indices Test Record Highs Ahead of CPI and PPI Analysis

Stocks Rally Toward Highs as Traders Eye Rate Cuts, AI Boost

Wall Street ended Tuesday on a high note, with the S&P 500, Nasdaq, and Dow Jones Industrial Average each logging strong gains just shy of record closes. A weaker-than-expected labor market revision fueled bets the Federal Reserve will lower interest rates, while AI-driven optimism continued to support upside across sectors.

S&P 500 Inches Toward Resistance at 6,532 — Can Bulls Push Higher?

The S&P 500 advanced 0.27% to close at 6,512.61, within striking distance of last week’s record close of 6,532.65. Price action remains bullish, with the index holding above the 50-day moving average at 6,363.4. A confirmed breakout above 6,532 would put 6,600 on watch.

Sector performance was led by communication services, which gained 1.64%, followed by a 0.71% lift in utilities. However, Apple slid 1.5% after unveiling new iPhones that fell flat with investors, and Broadcom lost 2.6% after a five-day winning streak. These mixed signals suggest some near-term hesitation, with inflation data likely to drive the next move.

Nasdaq Close Just Below High — Is Tech Still Leading?

The Nasdaq gained 0.37% to settle at 21,879.49, shy of its recent peak at 21,891.17. The index remains in a strong uptrend, staying well above its 50-day moving average of 21,131.1. The technical setup supports further upside if buyers can reclaim the high.

AI-related momentum continued, with Nebius soaring nearly 50% on news of a $17.4 billion deal with Microsoft. CoreWeave also climbed 7%. However, with stretched valuations, traders are closely monitoring rate expectations and CPI data, which could temper sentiment in rate-sensitive tech stocks.

Dow Holds Gains but Meets Resistance Near 45,770

The Dow Jones rose 0.43% to 45,711.34, just shy of its September 5 high at 45,770.20. Price remains bullish, continuing to bounce from last week’s low at 44948.16, with the 50-day moving average at 44,719.3 acting as a key floor.

UnitedHealth helped lift the index after reiterating its Medicare guidance. JPMorgan added 1.7% on strong Q3 revenue outlooks for investment banking and trading. Still, without a firm break above 45,770, upside may be capped in the short term.

What’s Driving the Next Market Move?

Traders are watching Wednesday’s PPI and Thursday’s CPI closely. A weaker inflation print could reinforce bets on a 25 basis point cut at next week’s Fed meeting, with some futures pricing a 10% chance of a larger move.

Markets are sitting just below major resistance levels. For bulls, confirmation will require a clear breakout on volume, supported by softer inflation and continued strength in AI and megacap tech. For now, the uptrend remains intact — but caution is warranted into Thursday.

More Information in our Economic Calendar.