US wholesale prices miss forecasts; NASDAQ rises 0.62%

All three major US stock indexes rose Wednesday, lifted by wholesale inflation data that came in well below expectations and a rally in large-cap technology stocks. June's producer price index fell short of market forecasts, and comments from Federal Reserve officials helped ease concerns about further monetary tightening, improving investor sentiment.

The Dow Jones Industrial Average closed up 150.37 points, or 0.29 percent, at 52,658.64 on the New York Stock Exchange. The S&P 500 gained 28.81 points, or 0.38 percent, to finish at 7,572.40, while the NASDAQ rose 162.22 points, or 0.62 percent, to close at 26,269.23.

The main driver of improved sentiment was the inflation reading. The US Department of Labor reported that the June producer price index fell 0.3 percent from the previous month, missing market expectations of a flat reading. It was the first month-over-month decline in the PPI since August last year, when it fell 0.2 percent, and the steepest drop since April last year's 0.3 percent decline. Producer prices, also known as wholesale prices, are widely regarded as a leading indicator for consumer prices, as they tend to feed through to the cost of finished goods with a lag.

Remarks from Fed officials also helped ease tightening fears. New York Federal Reserve President John Williams said in a speech Wednesday that he expects inflation to have peaked and to slow going forward. According to the CME FedWatch tool, the probability of the Fed raising its benchmark interest rate at the July 28-29 FOMC meeting fell to 10.2 percent Wednesday, down from 31.0 percent on July 8.

Fed Chair Kevin Warsh told a Senate Banking Committee hearing Wednesday that Donald Trump had not interfered with the Fed's independence and that any such attempt would not succeed, further calming market concerns.

Among individual stocks, profit-taking weighed on AI semiconductor shares that had recently surged, while buying flowed into large-cap technology names. Apple climbed more than 4 percent to set a record high, with Microsoft, Amazon and Alphabet each rising around 3 percent and leading the broader index higher.

Micron Technology fell 8.02 percent, while Intel dropped 4.43 percent and AMD declined 3.46 percent. The VanEck Semiconductor ETF slid 1.59 percent, and SK Hynix's American depositary receipt fell 9.00 percent to close at $176.46.

Strong second-quarter earnings from financial firms also supported the market. BlackRock, the world's largest asset manager, saw its shares jump 6.63 percent after total assets under management surpassed $15.3 trillion, buoyed by a global equity rally and fresh capital inflows. Morgan Stanley rose 0.39 percent after posting record second-quarter net profit and sales.

PayPal surged 17.21 percent on news that payments firm Stripe and private equity fund Advent had made a takeover offer valuing the company at $53 billion, or $60.50 per share.

However, ongoing military tensions between the United States and Iran pushed oil prices slightly higher. September Brent crude settled up 0.26 percent at $84.95 a barrel, while August West Texas Intermediate rose 0.33 percent to $79.60 a barrel.