US stocks rise to a record as oil prices drop and inflation gets less
bad
[August 14, 2026] By
STAN CHOE
NEW YORK (AP) — The U.S. stock market rose to an all-time high Thursday
following the latest sign that inflation is getting less bad. Stocks
also got a lift from easing oil prices in their latest yo-yo move.
The S&P 500 climbed 0.7% and topped its prior record set last week. The
Dow Jones Industrial Average added 69 points, or 0.1%, and the Nasdaq
composite gained 0.8%.
Wall Street relaxed after a report showed prices at the U.S. wholesale
level were 4.7% higher last month than a year earlier. While that’s more
painful than anyone would like, it’s not as bad as June’s 5.5% inflation
rate at the wholesale level, and it was slightly better than economists
expected.
If inflation continues to trend that way, the Federal Reserve could
decide to hold off on hikes to interest rates. Higher rates would help
keep a lid on inflation, but they do so by intentionally slowing the
economy and making it more expensive for everyone to borrow money.
Fed officials are split on whether they should have already begun hiking
interest rates. But Thursday’s report, following a similar update on
inflation at the U.S. consumer level the day before, has traders now
betting on just a 35% chance that the Fed will raise the federal funds
rate at its next meeting in September. That’s down from the roughly 50%
probability seen two days ago, according to data from CME Group.
Any increase by the Fed would be the first in more than three years. It
also could anger President Donald Trump, who has been lobbying for lower
interest rates.
Treasury yields sank in the bond market, which eases pressure on stocks
and other investments. The yield on the 10-year Treasury fell to 4.65%
from 4.68% late Wednesday and from 4.72% on Monday, though it’s still
well above its 3.97% level from before the war with Iran sent oil and
gasoline prices surging.
Oil prices eased back on Thursday, helping to limit worries about
inflation. The price for a barrel of Brent crude oil fell 2.1% to
$87.07.
It’s been swinging sharply recently and pinballed between $72 and $102
last month as hopes rose and fell that a deal in the war could allow oil
tankers to freely exit the Middle East again and deliver crude
worldwide.
On Wall Street, stocks in the real-estate industry climbed to some of
the market’s bigger gains. When interest rates are lower and bonds are
paying less in yield, the dividends that many real-estate investment
trusts pay look more attractive.
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Trader Fred Demarco, right, and Specialist Michael Pistillo, left,
work on the floor of the New York Stock Exchange, Friday, Aug. 7,
2026, in New York. (AP Photo/Yuki Iwamura)
 Lower mortgage rates could also
drive more activity in the housing market, and the average long-term
U.S. mortgage rate fell this week for the first time in six weeks.
AvalonBay Communities, which owns apartments across the country,
rose 2.3%. Homebuilder D.R. Horton added 2.8%.
Fossil Group climbed 5.9% after the seller of watches and jewelry
became one of the latest companies to report better results for the
latest quarter than analysts expected. Such reports have helped
drive Wall Street to records because stocks tend to track the path
of corporate profits over the long term.
They helped offset a drop for Cisco Systems, which fell 8.4% even
though the tech giant reported stronger profit and revenue for the
latest quarter than Wall Street expected.
Analysts said investors may be worried about its profit margins
going forward, and its stock has been shaky through the summer amid
worries that AI-related stocks in general shot too high.
All told, the S&P 500 rose 50.49 points to 7,798.99. The Dow Jones
Industrial Average added 69.72 to 53,839.99, and the Nasdaq
composite climbed 214.54 to 26,803.03.
In stock markets abroad, indexes dipped in Europe following a mixed
finish in Asia.
South Korea’s Kospi again had one of the world’s biggest moves and
jumped 3.6%. Seoul has been at the center of the world’s swings for
artificial-intelligence stocks because its market is dominated by
two tech giants, Samsung Electronics and SK Hynix.
___
AP Business Writers Yuri Kageyama and Michelle Chapman contributed
to this report.
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