Stock Markets Rally on Soft PPI Data Amid Shutdown Fears

The S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQ) climbed Tuesday as August's producer price index (PPI) surprised to the downside, showing a 0.1% monthly decline versus expectations of a 0.3% increase. Core PPI similarly fell 0.1%, marking a sharp reversal from July's 0.7% gain (revised down from 0.9%). SPY hit a record intraday high of $654.54 as the data fueled Optimism about easing inflationary pressures.

Political tensions flared alongside the economic data, with former President TRUMP lashing out at Fed Chair Powell on Truth Social: "No Inflation!!! 'Too Late' must lower the RATE, BIG, right now." FHFA Director Bill Pulte echoed the criticism on X. Meanwhile, prediction market Polymarket shows a 56% chance of government shutdown by year-end as Democrats threaten to block funding measures.