Shares surged Wednesday across Europe and Asia after U.S. stocks hit new records following data showing a slight easing in U.S. inflation last month.

Tokyo’s benchmark Nikkei 225 extended gains from a record set the previous day. Futures for the S&P 500 rose 0.2%, while Dow Jones Industrial Average futures remained largely unchanged.

The recent rally has been driven by relief over a 90-day truce in President Donald Trump’s trade war with China, coupled with hopes the Federal Reserve may cut interest rates, reinforced by July’s moderation in the consumer price index.

In Europe, Germany’s DAX rose 0.8% to 24,207.78 and Paris’ CAC 40 gained 0.4% to 7,784.63. Britain’s FTSE 100 edged up 0.1% to 9,157.26.

“Asia opened in full risk-on mode, following a U.S. session buoyed by moderate CPI,” said Stephen Innes of SPI Asset Management.

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In Asia, Hong Kong’s Hang Seng jumped 2.6% to 25,613.67, Shanghai Composite added 0.5% to 3,683.46, and Tokyo’s Nikkei 225 gained 1.3% to 43,274.67. South Korea’s Kospi rose 1.1% to 3,224.37, Taiwan’s Taiex 0.9%, and India’s Sensex 0.5%. Australia’s S&P/ASX 200 fell 0.6% to 8,827.10, while Bangkok’s SET climbed 1% after the Bank of Thailand cut its key rate by 0.25 percentage points to 1.5%.

Tuesday saw the S&P 500 rise 1.1% to 6,445.76, the Dow climb 1.1% to 44,458.61, and the Nasdaq jump 1.4% to a record 21,681.90. Lower inflation raised hopes the Fed may cut rates in September, boosting borrowing and investment.

U.S. consumer prices in July were 2.7% higher than a year ago, matching June and below economists’ 2.8% forecast. A rate cut would support growth amid concerns over Trump’s tariffs and their impact on inflation.

In early trading, U.S. crude oil fell 26 cents to $62.91 per barrel, Brent crude declined 20 cents to $65.92, the dollar eased to 147.24 yen, and the euro rose to $1.1727.

Source: Agency