Wall Street Rallies as Inflation Cools — Dow Soars 350 Points, S&P 500 and Nasdaq Hit Record Highs

U.S. stocks surged on Friday after fresh inflation data signaled continued cooling price pressures, fueling optimism that the Federal Reserve could move closer to cutting interest rates.

The Dow Jones Industrial Average jumped more than 350 points, while both the S&P 500 and the Nasdaq Composite climbed to new all-time highs, extending their historic 2025 rally.

According to data released by the U.S. Bureau of Labor Statistics, the Consumer Price Index (CPI) rose 0.3% in September, slightly below market expectations of 0.4%. The softer reading bolstered hopes that inflation is firmly on track toward the Fed’s 2% target, easing fears of renewed tightening.

Market analysts said the report strengthened the case for a dovish policy pivot, with traders now betting that the Fed could deliver its first rate cut before year-end.

Tech and financial stocks led the rally, while Treasury yields slipped and gold steadied as investors priced in a lower-for-longer interest rate outlook.

As one analyst put it, “The market finally feels like the Fed is done fighting inflation — and that’s a green light for equities.”