Wall Street Hits Record Highs on Cooler Inflation, Strong Earnings

U.S. stock markets reached record closing highs following the release of cooler-than-expected inflation data and strong corporate earnings, which together have boosted investor confidence. The Labor Department's Consumer Price Index showed inflation rising 3% year-over-year in September, slightly below forecasts, with core inflation easing more than expected, encouraging expectations of a Federal Reserve rate cut next week. Third-quarter earnings have exceeded expectations, with 87% of companies beating earnings estimates and 83% surpassing revenue forecasts, fueling optimism for a robust end-of-year rally. Notable upcoming earnings reports from major tech firms such as Meta, Microsoft, Alphabet, Amazon, and Apple are highly anticipated alongside strong performances from industrial and automotive companies like Caterpillar, General Motors, and Ford. General Motors and Ford notably posted double-digit weekly gains, with GM planning new autonomous driving features and Ford expanding truck production in response to positive forward guidance. Additionally, optimism around a possible meeting between President Trump and Chinese President Xi Jinping has supported market sentiment and trade outlooks.