Jobs data scheduled for release in early September will have more sway over the Fed’s next decision than this inflation report.

Canada's main stock index posted on Tuesday a new record high, with financial shares participating in broad-based gains as U.S. inflation data reinforced expectations that the Federal Reserve would cut interest rates in September.

Expectations for MM PPI data suggest producer inflation rose by 0.2%, up from 0.0% in June, while the YY print is also expected to increase by 2.5% (up from 2.3%). This is an important report. Similar to the CPI data just released, some of the PPI data feeds into the PCE report, which is what the Fed targets for inflation – the headline measure.

The S&P 500 Index ($SPX) (SPY) on Tuesday rose by +1.14%, the Dow Jones Industrials Index ($DOWI) (DIA) rose by +1.10%, and the Nasdaq 100 Index ($IUXX) (QQQ) rose by +1.33%. September E-mini S&P futures (ESU25) rose by +1.

The U.S. stock market rallied to records on Tuesday after data suggested inflation across the country was a touch better last month than economists expected. The S&P 500 rose 1.1% to top its all-time high set two weeks ago.