US stock markets finished mixed on Wednesday, with the Dow posting losses but the S&P 500 and Nasdaq notching more record highs, as traders reacted to an unexpected drop in wholesale prices.
US wholesale prices edged 0.1% lower in August, following a 0.7% rise in July, defying expectations for a 0.3% increase and offering a potential reprieve for Federal Reserve policymakers ahead of next week's rate decision.
The Dow retreated 0.48% after hitting a record on Tuesday, with a slump in the share price of Apple weighing heavily on the index.
However, the Nasdaq edged 0.03% higher to a new closing high of 21,886.06, while the S&P 500 rose 0.30% to reach a new peak of 6,532.04, helped by a huge surge in Oracle's stock on the back of some bullish guidance.
"The PPI slip was modest -- minus 0.1% -- but in this theatre, nuance matters. What markets heard wasn't just a tick lower in input prices; it was confirmation that the worst inflation ghost stories aren't materializing. Producers aren't shoving tariffs straight onto consumers; they're eating some of it to stay competitive," said Stephen Innes, managing partner at SPI Asset Management.
"That's not exactly a victory march -- more like a poker player bleeding chips slowly to stay in the game -- but it buys the Fed breathing room."
Wednesday's PPI release comes ahead of Thursday's consumer price index print, which was expected to show headline inflation rising to 2.9% annually. Together, the two reports will help shape expectations for the Fed's September policy meeting, where markets are pricing in a potential pivot toward easing.
Elsewhere on the macro front, US mortgage applications surged 9.2% in the week ended 5 September, according to the Mortgage Bankers Association of America. Last week's drop fully erased the drop from three consecutive weeks following a 15bps plunge in benchmark mortgage rates, which fell to their lowest in nearly a year, as a wave of disappointing labour market data pushed down yields on long-dated Treasury securities. Applications to refinance a mortgage, which are more sensitive to short-term changes in interest rates, shot up 12.2% week-on-week, while applications to purchase a home rose by 6.6%.
Market movers
Shares in Oracle Corporation soared 36% after the US tech giant said it was on track to secure contracts in its core cloud business worth in excess of $500bn. The enterprise software specialist said it had won four multi-billion dollar contracts with three customers in an "astonishing" first quarter, according to chief executive Safra Catz.
As a result, its remaining performance obligations - a key measure of booked revenues - increased 359% to $455bn. This, Catz said, "is likely to exceed half a trillion dollars" due to the expected signing up of "several additional multi-billion dollar customers".
The news helped shares of chipmaker Broadcom, while sector peer TSMC gained after impressing with its latest monthly sales stats.
Apple finished more than 3% lower as investors reacted negatively to the iPhone maker's latest product releases, which included the superthin iPhone Air and iPhone 17.