The Dow Jones and S&P 500 hit new highs amid slowing inflation.

The Dow Jones and S&P 500 closed at record highs on Wednesday after data showed that US inflation has slowed and may have peaked. At the same time, economy-sensitive stocks rose following the passage of the bill on infrastructure spending.

The US consumer price index (CPI) rose 0.5% in July after increasing 0.9% in June, the Labor Department said Wednesday.

“The numbers certainly point to a further slowdown,” said Stephen Riquuto of Mizuho Securities USA LLC.

This data will put the Fed in some embarrassment because they talked about curtailing (incentives), tightening rates, and defending. Inflation indicators are not quite at the level at which they should be. Still, they certainly do not show that it all got out of control. “

The Dow Jones closed 0.62% higher to 35.484.97 points, the S&P 500 rose 0.25% to 4.447.7 points, while the Nasdaq dropped 0.16% to 14.765.135 points …

Hours after the US Senate approved a $ 3.5 trillion budget proposal to invest in new domestic programs; disagreements arose between the moderate and liberal wings of the Democratic Party over the size and scope of the spending.

On Tuesday, the Senate passed a massive $ 1 trillion infrastructure spending bill.

Construction and mining equipment maker Caterpillar Inc rose 3.55%, providing the most extensive support for the Dow, while rival Deere & Co gained 2.51%.

Building materials supplier Vulcan Materials Co rose 3.24%, and steelmaker Nucor Corp rose 3.91% as they are likely to benefit from infrastructure projects.