On Wednesday, equities experienced an uptick, contributing to their ongoing momentum, as anticipations for reduced U.S. Federal Reserve interest rates persist in propelling the major indexes to unprecedented peaks.

The Dow Jones Industrial Average experienced an increase of 463.66 points, representing a rise of 1.04%, closing at 44,922.27. The S&P 500 experienced a modest increase of 0.32%, concluding the session at 6,466.58. Meanwhile, the Nasdaq Composite recorded a slight uptick of 0.14%, ending at 21,713.14. Both indexes achieved record highs for the second consecutive day.

AMD experienced a notable increase of 5.4%, positioning itself as the frontrunner in the technology sector’s gains. Apple experienced an increase of 1.6%. Shares of Paramount Skydance experienced a notable increase of 36.7%. The recent market movements were influenced by a record-setting session on Tuesday, which was catalyzed by an inflation report that was less alarming than anticipated, thereby fostering investor optimism regarding a potential Federal Reserve rate cut in September. Market participants are anticipating an almost certain probability of a rate reduction during the Federal Reserve’s September meeting, as indicated by trading data from the CME’s FedWatch Tool.

Ross Mayfield, an investment strategist at Baird, highlighted the robust performance of the second-quarter earnings season thus far as a significant driver for the market. Although the frequency of earnings reports has diminished in recent days, it is set to accelerate next week with a significant number of prominent retail companies scheduled to report. “This has been a really impressive earning season, which showcases kind of a corporate resilience from all the headwinds that we saw across the summer,” he said to CNBC. “You also had just a really nice kind of breadth.”

Market participants shifted their allocations away from the large-cap “Magnificent Seven” stocks, opting instead for smaller equities, as evidenced by the 2% increase in the Russell 2000 on Wednesday. Small-cap stocks stand to gain from reduced interest rates, as these rates diminish the cost of capital and may enhance consumer spending. Thursday’s producer price index report on wholesale inflation will contribute further to the overall economic landscape. The report arrives in advance of the Fed’s Jackson Hole gathering on Aug. 21-23, an event that may significantly influence anticipations regarding the central bank’s forthcoming policy decisions.