Stock market today: Wall Street drifts into moderate trading around last week's records

Several large technology companies have gained ground. Apple rose 2% and Microsoft 0.3%. Their high values ​​tend to strongly influence the direction of the market.

Overall, the S&P 500 rose 8.60 points to 5,477.90. The Dow Jones gained 15.64 points to 39,127.80, and the Nasdaq rose 87.50 points to 17,805.16.

This week, Wall Street is mainly focused on the government's latest inflation report on Friday. The personal consumption expenditures index, or PCE, is the Federal Reserves preferred measure of inflation.

The market is idling, like a race car waiting for the green light, said Sam Stovall, chief investment strategist at CFRA. The light will come on Friday morning, when the PCE figures are published.

Wall Street expects the index to show that the inflation rate fell to 2.6% in May, from 2.7% in April.

The Fed is trying to bring inflation back to its 2% target, but the rate remains stable. The PCE index has been hovering just below 3% for months. The better-known consumer price index is hovering around 3% throughout 2024, although it reached 9.1% by mid-2022.

The latest inflation updates could influence central banks' decision on when to start cutting interest rates, which remain at their highest level in more than 20 years.

Noisy inflation data might be enough to prompt policymakers to remain cautious in their decisions, but the global disinflationary process is well established, Solita Marcelli and other analysts said in a UBS report. Easing price pressures and other economic considerations should encourage central banks to begin or continue cutting rates.

In the bond market, Treasury yields have been mixed. The 10-year Treasury yield rose from 4.25% to 4.32% Tuesday evening. It is down from a peak of 4.70% in late April, which eased pressure on the stock market.

Investors are hoping the Federal Reserve will soon begin cutting interest rates. Wall Street is betting on a rate cut at the September central bank meeting.

The economy has remained relatively strong, despite inflation and high borrowing costs for consumers and businesses. However, economic growth is slowing and consumers seem more stressed and are redirecting their spending towards basic necessities. Wall Street is hoping the Fed can time its rate cuts to relieve pressure on the economy before it slows too much, but it also won't miss its goal of curbing inflation.

It's too early for the market to be encouraged or disappointed by the results, so the near-term focus will be on economic indicators that would imply the Fed could cut interest rates as soon as September, Stovall said.