S&P 500 hits record high as flat July PPI data boosts investor sentiment

US stock markets closed higher on Thursday, with the S&P 500 reaching a new record high of 7,798.99, up 0.65%. The Dow Jones Industrial Average rose approximately 70 points to close at 53,839.99, while the NASDAQ Composite climbed 0.81% to 26,803.03. The positive market movement was driven by macroeconomic data indicating cooling inflation pressures and improving investor sentiment.

Macroeconomic Data

The market rally aligned with the release of the July Producer Price Index (PPI) data. Headline producer prices remained flat for the month, missing the anticipated 0.2% monthly rebound. Core PPI also undershot expectations, echoing Wednesday’s cooler consumer inflation report that showed the annual rate easing to 3.4%. On an annual basis, producer inflation had previously eased to 4.7%, down from 5.5%.

Labor market data showed signs of softening, with US initial jobless claims rising by 9,000 to 209,000 in the week ended August 8, exceeding market estimates of 202,000.

Investor sentiment improved alongside the economic data. The CNN Money Fear and Greed Index rose to 66 from a prior reading of 63, remaining firmly in the 'Greed' zone. The index, which ranges from 0 (maximum fear) to 100 (maximum greed), is calculated based on seven equal-weighted indicators.

Sector Performance

Most sectors within the S&P 500 closed positively. Information technology, real estate, and communication services stocks recorded the biggest gains during the session. Conversely, energy and materials stocks bucked the broader market trend, closing lower.

Top Movers

Several equities saw significant volatility based on corporate announcements and earnings results:

SanDisk Corp (NASDAQ: SNDK) soared around 14% after unveiling a new optimistic roadmap during its investor day.
XChange TEC Inc (NASDAQ: XHG) surged 554% to $5.98 after announcing its intent to acquire First Cycle Inc.
DEFSEC Technologies Inc (NASDAQ: DFSC) rose 108% to $2.58 following third-quarter financial results.
FGI Industries Ltd (NASDAQ: FGI) gained 55% to $7.50 after reporting better-than-expected second-quarter adjusted EPS and issuing FY26 sales guidance with a midpoint above estimates.

On the downside:

Cisco Systems Inc (NASDAQ: CSCO) fell over 8% after reporting fourth-quarter fiscal 2026 financial results.
Leslie’s Inc (NASDAQ: LESL) fell 38% to $0.82 after reporting worse-than-expected third-quarter results and withdrawing FY26 guidance.
Cellebrite DI Ltd (NASDAQ: CLBT) dropped 35% to $9.95 following weak second-quarter sales results and subdued third-quarter guidance.
Founder Group Ltd (NASDAQ: FGL) declined 37% to $0.49.

Global Markets and Commodities

European markets showed mixed performance. The eurozone’s STOXX 600 gained 0.1%, while Spain’s IBEX 35 rose 0.5%. In contrast, London’s FTSE 100 fell 0.4%, Germany’s DAX gained 0.2%, and France’s CAC 40 dipped 0.1%.

Asian markets also closed mixed. Japan’s Nikkei 225 rose 1.16%, and India’s BSE Sensex increased 0.15%. However, Hong Kong’s Hang Seng index fell 0.17%, and China’s Shanghai Composite declined 0.50%.

In commodities, oil prices dropped 2.6% to $81.12. Precious metals faced headwinds, with gold falling 0.6% to $4,441.40 and silver down 0.6% to $65.315. Copper was the only gainer among major metals, rising 0.1% to $6.6160.

What the Numbers Show

The combination of flat headline producer prices and rising jobless claims reinforces the narrative of disinflationary pressure in the US economy. While the S&P 500 hit a record high, the divergence between tech-led gains and declines in energy and materials suggests sector rotation driven by lower inflation expectations rather than broad-based economic acceleration. The move of the Fear and Greed Index into the 'Greed' zone indicates that investors are increasingly willing to take risks despite the mixed signals from labor market data.