Stock Markets Reach Record Highs Amid Anticipation of Fed Moves

U.S. stock markets reached record highs as investors awaited a key inflation report and Federal Reserve Chair Jerome Powell's Congressional testimony. The Dow, S&P 500, and Nasdaq all saw gains. Expectations for interest-rate cuts grew, fueled by slowing job growth. Major tech and bank stocks were closely watched.

U.S. stock markets hit record highs on Monday, with the Nasdaq and S&P 500 leading the surge as investors eagerly awaited a crucial inflation report and Federal Reserve Chair Jerome Powell's Congressional testimony. The Dow also experienced a rise, reaching a one-month high.

Markets are increasingly betting on interest-rate cuts as early as September, following a slower-than-expected job growth report. Traders now see a 74% chance of a 25-basis-point cut in September.

This week's consumer and producer price index data will be pivotal in assessing whether inflationary pressures are diminishing. "The Fed's dual mandate of employment and inflation is steering them towards a potential rate cut, possibly by September," said Thomas Hayes of Great Hill Capital LLC.

(With inputs from agencies.)