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U.S. equity futures edged higher Wednesday, while the dollar held steady against its global peers and Treasury yields resumed their recent climb, as investors navigated though yesterday’s February inflation report to lift the S&P 500 to a record.

Stocks managed to shrug off the hotter-than-expected details on price pressures, which showed an untick in headline CPI against a modest downward movement in the key core reading. Stocks pushed higher on the back of big gains for AI-related tech stocks.

Related: February inflation surprises with modest uptick, but core pressures ease

The S&P 500 closed at 5,175.27 points, taking its year-to-date advance to around 8.5%, thanks in part to a 7% surge in Nvidia  (NVDA)  and the biggest single-day gain for Oracle  (ORCL)  since 2021.

The moves also came despite a firm move higher in Treasury yields. Bond traders were spooked by both the headline inflation reading and a weaker-than-expected auction of $39 billion in new 10-year notes, which drew meager demand from foreign investors. 

Benchmark 10-year notes, holding on to their recent spike, were last marked at 4.161% heading into the New York trading session, with 2-year paper pegged at 4.607%.

The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.02% higher at 102.973.

That said, the odds of a June interest-rate cut from the Federal Reserve are still trading around the 60% mark, with traders betting on at least three, and possibly four, rate reductions between now and the end of the year.

Wall Street’s next focus is likely to be Thursday’s factory-gate inflation report, set to arrive before the start of trading alongside February retail-sales data. The next critical factor: the Fed’s March policy meeting next week in Washington.

“Hopes remain that even though we continue to be far from the Fed’s 2% target they will still make cuts, believing that a lower federal-funds rate will still keep sufficient pressure on inflation to move eventually towards 2%,” said Nigel Green of London-based DeVere Group. 

“Behind the curtain, there is undeniable political pressure to lower rates given soaring government debt levels, a meaningful part that is on the short end of the yield curve.”  

Heading into the start of the trading day, stocks are looking at a muted open, but the S&P 500 is still called 2 points higher from last night’s close, with futures contracts tied to the Dow Jones Industrial Average indicating a 48-point advance.

The tech-focused Nasdaq, meanwhile, is called 15 points lower, thanks in part to another leg lower for Tesla  (TSLA)  and premarket declines for chipmakers Advanced Micro Devices  (AMD)  and Intel  (INTC) .

In Europe, the regionwide Stoxx 600 was marked 0.23% in early Frankfurt trading, with Britain’s FTSE 100 0.11% higher in London following surprisingly solid January GDP data.

Overnight in Asia, the Nikkei 225 slipped for a second day, falling 0.26% to close at 38,695.97 points. The MSCI ex-Japan benchmark traded near a seven-month high before slowing to the finish and ending 0.36% lower in the session.

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