US Equity Indexes Touch All-Time Highs as Rising Bets for Policy Easing Point to Fed's Focus on Weak Labor Market

05:03 PM EDT, 09/11/2025 (MT Newswires) -- US equity indexes hit records on Thursday as the Federal Reserve is expected to focus more on weakness in the labor market than seemingly hot consumer price inflation when it resumes policy easing next week.

The Dow Jones Industrial Average traded up 1.4% to 46,108.0, after hitting an all-time high of 46,137.20. The Nasdaq Composite was up 0.7% to 22,043.07, after scaling a new peak of 22,059.71 earlier in the session. The S&P 500 traded 0.9% higher at 6,587.47, after touching a record 6,592.89.

All sectors except energy rose intraday, with materials, consumer discretionary, and healthcare leading the gainers.

Initial jobless claims rose to 263,000 in the week ended Sept. 6, the highest since October 2021, from a downwardly revised 236,000 in the previous week. The expectations were for 235,000 in a Bloomberg-compiled survey.

The consumer price index rose by 0.4% in August, the highest since January, up from 0.2% in July, the Bureau of Labor Statistics reported Thursday. A Bloomberg-polled consensus was 0.3%. Annually, inflation accelerated 2.9% from 2.7%, in line with the outlook. However, core inflation was steady at 0.3%, while the annual core measure was unchanged at 3.1%. Both prints were in line with expectations.

Another iteration of inflation, the supercore -- defined as core services excluding housing -- rose 0.3% in August, the smallest monthly gain since June, according to a Stifel note. Over the past 12 months, the supercore increased 3.3%, matching the 3.3% annual gain in July.

"The [inflation] report will be scrutinized for signs that the parts of the CPI basket not affected by tariffs (e.g., core services) are seeing enough disinflation to justify an extended rate cut cycle," Thierry Wizman, global foreign-exchange and rates strategist at Macquarie Group, said in a note.

Markets are pricing an 81% probability that the Federal Open Market Committee will lower interest rates by 75 basis points between September and December, up from 68% a day ago, according to the CME FedWatch Tool. There is zero chance for the Fed to leave rates unchanged next week, meaning the policy easing cycle will resume on Sept. 17.

Treasury yields were mixed, with the 10-year down one basis point to 4.02% and the two-year rate steady at 3.54%. Yields declined across the curve earlier in the session.

The ICE US Dollar Index retreated 0.3% to 97.52.

West Texas Intermediate crude oil futures slumped 2.2% to $62.30 a barrel.

Gold futures fell 0.3% to $3,672.40.

In company news, Paramount Skydance (PSKY) is reportedly preparing a majority cash bid for media and entertainment giant Warner Bros. Discovery (WBD) , according to The Wall Street Journal, which cited unnamed sources. Warner Bros. shares surged 29%, making it the leader on the S&P 500 and the Nasdaq. Paramount soared nearly 16%, the second-biggest gainer on the S&P 500.

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