By the end of yesterday's session, US stock indices closed higher. The S&P 500 rose by 1.13%, while the Nasdaq 100 jumped by 1.39%. The industrial Dow Jones gained 1.10%.

Indices climbed to record levels after US inflation data eased concerns over rising prices and reinforced expectations for a Federal Reserve interest rate cut in September. Investors welcomed the slowdown in consumer price growth, hoping it will allow the Fed to shift toward a looser monetary policy. Signs of cooling in the labor market further support the case for interest rate cuts. This creates a favorable environment for companies, particularly in the technology sector, which have historically benefited from low interest rates that stimulate investment and growth.

However, despite the optimism, investors should not lapse into euphoria. Inflation still exceeds the Fed's 2% target, and premature rate cuts could trigger a renewed acceleration in prices. Moreover, geopolitical instability and potential supply chain disruptions following the introduction of trade tariffs remain risk factors that could upset the economic balance.

The MSCI All Country World Index rose by 0.2%, reaching an all-time high, following Wall Street's move to new records, as money markets have nearly fully priced in a 25-basis-point Fed rate cut next month. European stock index futures added 0.4%, signaling that the rally may continue. The Asian equity index gained 1.1%, with the Nikkei 225 hitting a record high.

Volatility in the US Treasury market also eased. The ICE BofA MOVE Index, which reflects expected yield fluctuations, fell to its lowest level since January 2022. Treasuries edged higher, pushing the 10-year yield down to 4.28%. The dollar stabilized after Tuesday's decline.

While core US inflation accelerated to its fastest pace since the start of the year, moderate growth in goods prices has eased fears that trade costs could drive broader price pressures. Following the release of the consumer price index, investors will now turn their attention to US retail sales data due on Friday.

This year, the Federal Reserve has kept rates unchanged, hoping to gain clarity on whether tariffs will lead to persistent inflation. At the same time, the labor market, the second pillar of its dual mandate, is showing signs of losing momentum.

Meanwhile, the greenback stabilized during Asian trading after a 0.4% drop in the previous session. The exchange rate is treading water ahead of key events later this week, including US retail sales data and developments in the Russia-Ukraine conflict.

As for the S&P 500 technical picture, the main task for buyers today will be to break through the nearest resistance level of $6,457. This would help extend the rally and open the way for a move to a new level at $6,473. Equally important for bulls will be maintaining control above $6,490, which would strengthen the buyers' position. In the event of a pullback amid declining risk appetite, buyers will need to defend the $6,441 area. A break below this level could quickly push the instrument down to $6,428 and open the way toward $6,414.