S&P 500 hits record after soft CPI, led by tech mega-cap gains

US stocks surged to a new high on Friday, as traders cheered softer-than-anticipated inflation data that underpinned expectations for Federal Reserve interest-rate cuts. Technology giants including Nvidia Corp., Broadcom Inc. and Alphabet Inc. led gains in the S&P 500 Index.

The benchmark rose 1% at 12:20 p.m. in New York, helped by advances in eight of 11 sectors in the index, led by utilities and technology. The Nasdaq 100 Index climbed 1.3%. The Bloomberg Magnificent Seven Price Return Index added 0.8%.

After weeks when traders had been deprived of key economic data because of the US shutdown, they received welcome news in a report showing consumer prices excluding food and energy rose a smaller-than-forecast 0.2% in September — the slowest pace in three months.

“Today’s CPI number offered investors the first tidbit of information from the barren wasteland of government data that has existed since the shutdown started Oct. 1,” said John Kerschner, Global Head of Securitized Products and Portfolio Manager at Janus Henderson, in emailed comments. “Investors were not disappointed.”

The CPI report was initially scheduled for Oct. 15 but delayed due to the federal government shutdown. To Citi economist Veronica Clark, the most important detail in the data was a “substantial” slowing in shelter inflation, a trend she sees likely continuing into 2026, and which could offset “somewhat stickier” goods prices as tariffs pass through.

Elsewhere, US Treasury Secretary Scott Bessent and China’s Vice Premier He Lifeng are meeting in Malaysia for trade talks, setting the stage for next week’s pivotal meeting between President Donald Trump and Chinese counterpart Xi Jinping.

On Friday, Alphabet rallied 2.9%. The Google parent will supply specialized AI chips to Anthropic in a deal worth tens of billions of dollars, helping the company’s cloud business and its Tensor Processing Unit (TPU) chips.

Intel Corp. erased earlier gains spurred by the chipmaker’s return to profitability and upbeat revenue forecast. The results signalled its comeback attempt — supported by investments from the White House, Nvidia Corp. and Softbank Group Corp. — is on track. Other chip companies climbed, with the Philadelphia Semiconductor Index advancing 2.2%. Nvidia added 1.7% and Broadcom rose 3.4%.

Ford Motor Co. surged 11%. The carmaker expects it will largely bounce back next year after a devastating fire hobbled a key supplier. Quarterly profit and sales beat estimates.

Palantir Technologies Inc. rose 2.7%. The company inked a more than $200 million deal to provide AI software to Lumen Technologies Inc. in a new partnership, part of a push by the telecom company to support more AI services, and a bid by Palantir to reach more customers.

Deckers Disappoints

In retail, Deckers Outdoor Corp. sank 12% after a disappointing sales forecast from the Ugg and Hoka brands owner. Target Corp. was little changed. The retail chain is cutting about 8% of its headquarters team, spanning 1,800 roles, in its first major restructuring in years.

Common shares of Fannie Mae slipped 4%. Earlier this week, the mortgage-finance giant appointed a new acting CEO.

“This management change confirms our view that a recap and release of Fannie Mae and Freddie Mac is unlikely to occur in the coming months,” TD Cowen’s Jaret Seiberg wrote in a note this morning, adding that investors will probably want a permanent CEO with a business plan before committing fresh capital.

Cryptocurrency-linked stocks advanced. JPMorgan Chase & Co. plans to allow institutional clients use Bitcoin and Ether holdings as collateral for loans, a significant deepening of Wall Street’s crypto integration. Bitcoin rose 0.6% to $110,232.

Next week offers a packed earnings slate, with reports due from heavy-hitters Alphabet, Meta Platforms Inc. and Microsoft Corp. after the close on Wednesday, and Apple Inc. and Amazon.com Inc. on Thursday.