Volkswacht Bodensee - US indices power to fresh records after benign inflation data

That, combined with Trump extending by 90 days a trade truce with China, cheered investors.

New York jumped after the US consumer price index (CPI) reading for July showed annualized inflation at 2.7 percent, unchanged from a month earlier.

Both the S&P 500 and Nasdaq finished at fresh records.

European markets were likewise boosted by the US inflation numbers, with all but Frankfurt rising.

While the headline CPI figure was lower than expected, underlying price increases indicated that Trump's tariffs were nevertheless starting to ripple through the US economy.

Core inflation, which strips out volatile costs such as food and energy, accelerated in July to the fastest pace in six months.

"Inflation from tariffs is beginning to feed into the core figure but not yet at the stage that is a major concern for markets," said Lindsay James, investment strategist at Quilter, a wealth management firm.

The dollar slipped against major currencies.

Investors calculated that the CPI data was not enough to sway the US Federal Reserve away from an expected interest rate cut next month.

The US central bank, which has an inflation target of two percent, also has to weigh other recent data, including signs in the labor market of slower economic growth.

Trump has relentlessly pressured Jerome Powell to ease monetary policy, reiterating his call for the Fed Chairman to cut rates immediately in a sneering post on his Truth Social platform.

Trump said he may allow "a major lawsuit" against Powell for his oversight of renovations of Federal Reserve buildings.

Katy Stoves, investment manager at Mattioli Woods, warned however: "This gentle cooling of the economy will certainly not justify a cut of interest rates to one percent as President Donald Trump is calling for."

Oil prices were lower, after OPEC's latest growth projections maintained estimates for 2025.

The oil cartel raised its demand forecast for 2026, signalling it expected stronger global activity next year.

Trump's announcement on Monday that he would put off reimposing sky-high levies on China to November, to give more time for talks, buoyed market sentiment.

Stock markets in Asia rose on the news, with Tokyo hitting a record.

Investors are also awaiting a summit between Trump and Russian leader Vladimir Putin on Friday, with the US president playing down the possibility of a breakthrough in ending the war in Ukraine.

In corporate news, China's real estate giant Evergrande Group said on Tuesday it will delist from Hong Kong Stock Exchange in the wake of its 2021 default. The company is emblematic of a years-long crisis in China's property market.

Intel rose 5.5 percent after CEO Lip-Bu Tan met with Trump, who praised the executive after previously calling for him to step down.

- Key figures at around 2050 GMT -

New York - Dow: UP 1.1 percent at 44,458.61 (close)

New York - S&P 500: UP 1.1 percent at 6,445.76 (close)

New York - Nasdaq: UP 1.4 percent at 21,681.90 (close)

London - FTSE 100: UP 0.2 percent at 9,147.81 (close)

Paris - CAC 40: UP 0.7 percent at 7,753.42 (close)

Frankfurt - DAX: DOWN 0.2 percent at 24,024.78 (close)

Tokyo - Nikkei 225: UP 2.2 percent at 42,718.17 (close)

Hong Kong - Hang Seng Index: UP 0.3 percent at 24,969.68 (close)

Shanghai - Composite: UP 0.5 percent at 3,665.92 (close)

Euro/dollar: UP at $1.1677 from $1.1615 on Monday

Pound/dollar: UP at $1.3501 from $1.3432

Dollar/yen: DOWN at 147.77 yen from 148.15 yen

Euro/pound: DOWN at 86.45 pence from 86.48 pence

Brent North Sea Crude: DOWN 0.8 percent at $66.12 per barrel

West Texas Intermediate: DOWN 1.2 percent at $63.17 per barrel

R.Fischer--VB