The three major indices of the New York Stock Exchange shattered their all-time high records on May 15th (GMT).
Composed of 30 large-cap stocks, the Dow Jones Industrial Average is on the verge of breaking 40,000.
The S&P 500, which is composed of 500 large companies and reflects a wide range of market conditions, broke through the 5,300 mark for the first time in history.
The tech-heavy Nasdaq also rose, setting a new all-time high record for the second consecutive day.
Despite the crash of meme stocks like GameStop and AMC, the U.S. April Consumer Price Index (CPI) met expectations, heightening expectations of slowing inflation and driving the three major New York Stock Exchange indices to their highest levels ever.
The Dow Jones closed the day up 349.89 points (0.88%) at 39,908.00, and the S&P 500 rose 61.47 points (1.17%) to close at 5,308.15.
The Nasdaq set a new all-time high for the second consecutive day, rising 231.21 points (1.40%) to 16,742.39.
The Wall Street Fear Index plunged over 7% to the 12-point range. The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) dropped 0.97 points (7.23%) to 12.45.
With the CPI meeting economists’ expectations for the first time this year, expectations for a rate cut in September have strengthened in the futures market.
The likelihood that the Federal Open Market Committee (FOMC) will keep rates at 5.25–5.5% during the September 17-18 meeting decreased from 34.9% the previous day to 24.7%.
On the other hand, expectations that rates will decrease to 5.00~5.25% rose from 50.5% to 52.7%, and expectations that the benchmark interest rate will fall to 4.75~5.00% after a rate cut in July surged from 14.1% to 21.0%.
The U.S. April CPI announced by the Department of Labor was 3.4% year-on-year, 0.1 percentage point lower than the March increase of 3.5%.
The core CPI, which excludes energy and food to reduce monthly volatility, also matched market expectations at 3.6%.
After two consecutive days of steep rises on May 13th and 14th, meme stocks plummeted on May 15th.
GameStop crashed to $39.55, a steep drop of $9.20 (18.87%), and the movie theater chain AMC plummeted to $5.48, a sharp drop of $1.37 (20.00%).
Car rental company Hertz fell sharply to $5.48, a drop of $0.52 (8.67%), and headphone company Koss fell to $4.97, a steep fall of $1.18 (19.19%).
Solar company SunPower crashed to $3.11, a sharp drop of $1.28 (29.16%).
On the other hand, semiconductor and related artificial intelligence (AI) server stocks rose sharply.
Nvidia, which is set to announce earnings on May 22nd, led the rise in semiconductors.
Nvidia closed at $946.30, a sharp rise of $32.74 (3.58%), and AMD closed at $159.67, a sharp rise of $6.51 (4.25%).
Micron rose $3.00 (2.40%) to close at $127.81, and Intel rose $0.22 (0.71%) to close at $31.27.
However, UK semiconductor design company ARM Holdings fell to $113.67, a drop of $2.98 (2.55%).
AI server companies soared.
Boosted by Morgan Stanley’s optimistic outlook for AI servers and an upward adjustment of PC company Dell Technologies’s target price from $128 to $152, Dell closed at $149.16, a sharp rise of $15.04 (11.21%).
Dell broke through $100 billion in market capitalization for the first time since its relisting in 2018, closing at an all-time high.
Super Micro Computer (SMCI), which dominates the AI server market, saw an even greater increase, soaring to $952.36, a sharp rise of $129.99 (15.81%).
International oil prices, which had fallen over 1% the previous day, rebounded on May 15th.
The decline in U.S. April CPI triggered the rebound in oil prices.
Brent crude, the international oil price benchmark, jumped $0.37 (0.45%) to $82.75 per barrel.
West Texas Intermediate (WTI), the U.S. oil price benchmark, also rose $0.61 (0.78%) to close at $78.63 per barrel.
