05:03 PM EDT, 08/13/2025 (MT Newswires) -- The S&P 500 and the Nasdaq Composite clinched record highs on Wednesday as traders bet that a Federal Reserve interest rate cut was almost certain in September.

The S&P 500 rose 0.3% to 6,466.6, while the Nasdaq edged up 0.1% to 21,713.1, both ending at new highs for a second consecutive day. The Dow Jones Industrial Average climbed 1% to 44,922.3, advancing for a second straight day. Most sectors posted gains, led by materials, while communication services saw the biggest drop.

The probability of a quarter-percentage-point rate cut in September was at 94% on Wednesday, with the remaining odds in favor of a bigger, 50-basis-point reduction, according to the CME FedWatch tool. Rate-reduction bets grew following the release of the official consumer prices report, which showed on Tuesday that inflation slowed down in July on a sequential basis.

There is "some momentum building" for a 50-basis-point cut, Lindsey Piegza, chief economist at Stifel, said in a report.

Treasury Secretary Scott Bessent said Wednesday "we could go into a series of rate cuts," beginning with a 50-basis-point reduction next month, Bloomberg News reported. He said interest rates in the country should "probably be 150, 175 basis points lower."

The official US producer prices report for last month is scheduled to be released Thursday.

"The market's trend looks to continue to the upside, driven by new all-time high momentum and expectations that tomorrow's July PPI report will also show minimal gains with the potential for a downward surprise similar to June's PPI report," Tigress Financial Intelligence Chief Market Strategist Ivan Feinseth said in a note released ahead of Wednesday's trading.

US President Donald Trump, who has repeatedly called on the Fed to cut rates and criticized the central bank's chair, Jerome Powell, said Wednesday that the list of potential candidates to replace Powell is "down to three or four names," Yahoo Finance reported. A report previously suggested that the Trump administration was contemplating a pool of up to 11 Fed chair candidates.

US Treasury yields were lower, with the 10-year rate decreasing 5.5 basis points to 4.24% and the two-year rate losing 5.4 basis point to 3.69%.

West Texas Intermediate crude oil fell 0.7% to $62.75 a barrel.

The International Energy Agency reduced its projections for global oil demand growth for 2025 and 2026, while raising its supply forecasts for both years on the back of the latest output hike by a key producing cartel.

"The latest data show lackluster demand across the major economies and, with consumer confidence still depressed, a sharp rebound appears remote," the agency said. "Oil market balances look ever more bloated as forecast supply far eclipses demand towards year-end and in 2026."

On Tuesday, the Organization of the Petroleum Exporting Countries raised its global oil demand projection for 2026 and upgraded its world and US economic growth forecasts for this year.

Trump is scheduled to meet with his Russian counterpart, Vladimir Putin, Friday. Trump recently announced an additional 25% tariff on imports from India in response to the Asian country's continued purchasing of sanctioned Russian oil.

The outcome of the meeting could remove "some of the sanction risk hanging over the market," ING Bank said in a report published Wednesday.

Mortgage applications in the US ramped up last week as lower 30-year rates on conforming loans spurred refinancing activity to the strongest week since April, the Mortgage Bankers Association said Wednesday.

In company news, Paramount Skydance ( PSKY ) shares surged nearly 37%, the top gainer on the S&P 500. Morgan Stanley and Guggenheim recently initiated coverage of the stock.

Paramount will become the exclusive distributor of UFC's fighting events in the US under a $7.7 billion media rights deal with TKO Group ( TKO ) , the companies said earlier in the week.

CoreWeave ( CRWV ) shares plummeted nearly 21% after the company posted a wider-than-expected second-quarter loss on Tuesday, though Tigress Financial said the company's upgraded outlook indicates continued demand acceleration.

Gildan Activewear ( GIL ) on Wednesday agreed to acquire clothing company HanesBrands ( HBI ) in a cash-and-stock deal worth about $2.2 billion in equity. Gildan shares were up nearly 12%, while Hanesbrands ( HBI ) rose 3.7%.

Madison Square Garden Entertainment ( MSGE ) swung to a fiscal fourth-quarter loss amid a slump in event-related revenue, sending its shares tumbling 8.5%.

Gold was up 0.3% at $3,407.80 per troy ounce, while silver rose 1.5% to $38.59 per ounce.