### Market Summary
Stocks surged significantly on Wednesday, maintaining robust strength throughout the afternoon. Both the Nasdaq and the S&P 500 reached new record intraday highs.
Currently, the Nasdaq has risen 297.88 points (1.7%) to 17,641.42, while the S&P 500 is up by 55.21 points (1.0%) to 5,430.53. Although the Dow pulled back from its earlier highs, it remains positively positioned, currently up by 31.99 points (0.1%) at 38,779.41.
### Major Economic Indicators
The early rally on Wall Street followed the release of a Labor Department report indicating that U.S. consumer prices were unexpectedly flat in May. The report noted that the consumer price index remained unchanged after a 0.3% increase in April. Economists had predicted a slight rise of 0.1%.
The flat reading is attributed to a 3.5% decline in gasoline prices, which balanced out continued increases in shelter prices. Excluding food and energy, core consumer prices grew by 0.2% in May, following a 0.3% increase in April. Core prices were anticipated to rise by 0.3%.
Additionally, the annual rate of consumer price growth decelerated to 3.3% in May from 3.4% in April, contrary to economists' expectations that it would remain steady. Similarly, the annual rate of core consumer price growth slowed to 3.4% from 3.6%, below the projected dip to 3.5%.
The lower-than-expected annual growth rates have renewed optimism regarding interest rates ahead of the Federal Reserve's monetary policy announcement scheduled for the afternoon.
### Expert Opinions
Quincy Krosby, Chief Global Strategist for LPL Financial, commented that the data should enable the Federal Reserve to adopt a "more positive view regarding monetary easing." Krosby added that the Federal Reserve remains data-dependent and requires more confirmation that inflation is on a downward trend.
Krosby further noted that "since data releases are assessed through the lens of the Fed and the probability for rate cuts, the CPI report should help underscore that the Fed is nearing ever closer to its initiation of the rate easing cycle."
While the Federal Reserve is widely expected to keep interest rates unchanged, traders will closely scrutinize the accompanying statement and officials' latest projections for the economy and interest rates.
### Sector Analysis
Interest rate-sensitive housing stocks demonstrated substantial strength, with the Philadelphia Housing Sector Index spiking by 3.9%. Semiconductor stocks also showed considerable resilience, reflected in a 3.1% surge by the Philadelphia Semiconductor Index.
Banking stocks have risen sharply during the session, pushing the KBW Bank Index up by 2.2%, rebounding from its lowest closing level in almost two months.
Other sectors exhibiting significant strength include computer hardware, airline, and software stocks. Conversely, oil producer stocks are among the few groups not following the upward trend.
### Other Markets
Overseas, Asia-Pacific stock markets had a mixed session on Wednesday. Japan's Nikkei 225 Index declined by 0.7%, while China's Shanghai Composite Index rose by 0.3%.
In Europe, major markets performed notably well; the German DAX Index surged by 1.4%, the French CAC 40 Index climbed by 1.0%, and the U.K.'s FTSE 100 Index advanced by 0.8%.
In the bond market, treasuries surged following the consumer price inflation data, resulting in the yield on the benchmark ten-year note dropping by 13.5 basis points to 4.267%.
