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Feb headline CPI rises 0.4% as expected

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Southwest Airlines ( LUV ) down on forecast cut for Boeing ( BA )

delivery

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Oracle jumps as AI demand reignites cloud business

momentum

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Indexes up: Dow 0.56%, S&P 0.96%, Nasdaq 1.36%

(Updated at 11:35 a.m. ET/ 1535 GMT)

By Bansari Mayur Kamdar and Shashwat Chauhan

March 12 (Reuters) -

The tech-heavy Nasdaq drove Wall Street higher on Tuesday,

as traders held on to bets of interest-rate cuts by the Federal

Reserve in the coming months, even as consumer prices data came

in slightly hotter than expected.

A Labor Department report showed U.S. consumer prices

increased in February amid higher gasoline and shelter costs.

The Consumer Price Index (CPI) rose 0.4% last month after

climbing 0.3% in January. Excluding volatile food and energy

components, consumer prices increased 0.4% in February after

rising by the same margin in January.

"Inflation came in a little hot, but the bulls aren't ready

to throw in the towel yet," said David Russell, global head of

market strategy at TradeStation.

"Investors remain optimistic that shelter costs will

come down. We still have three more reports before that key Fed

meeting in June to confirm or reverse that hope."

Traders are now seeing a 70% chance of the first rate

cut coming in June, according to the CME FedWatch Tool, from 71%

ahead of the inflation report.

Last month's stock market rally was slowed after data showed

signs of a robust economy and sticky inflation, as traders

pushed back expectations on the timing of the Fed's first rate

cut to June from March.

Producer prices data is on tap later this week and will

provide further insight into inflation.

At 11:35 a.m. ET, the Dow Jones Industrial Average

was up 217.15 points, or 0.56%, at 38,986.81, the S&P 500

was up 49.33 points, or 0.96%, at 5,167.27, and the Nasdaq

Composite was up 217.75 points, or 1.36%, at 16,237.02.

Eight of the 11 major S&P 500 sectors rose, with

rate-sensitive technology stocks leading gains at

2.0%.

Chip stocks snapped a two-day losing streak and rose

1.7%, with AI darling Nvidia ( NVDA ) jumping 5.9%.

Megacap growth peer Meta Platforms ( META ) added 3.4%.

Oracle jumped 11.2% on signs the firm was making

progress in its plan to grab a share of the cloud-computing

market, thanks to its tie-up with AI chip giant Nvidia ( NVDA ).

Boeing ( BA ) shed 3.5% after a report said an audit by the

Federal Aviation Administration found dozens of problems with

the 737 MAX's production.

Southwest Airlines ( LUV ) dipped 14.4% after saying it

expects a 42% drop in MAX deliveries this year from Boeing ( BA ) than

previously estimated, which will likely result in a cut in its

2024 capacity.

3M ( MMM ) climbed 4.2% after the industrial conglomerate

said William Brown would be appointed its chief executive

officer, effective May 1.

Advancing issues outnumbered decliners by a 1.24-to-1 ratio

on the NYSE and by a 1.01-to-1 ratio on the Nasdaq.

The S&P index recorded 33 new 52-week highs and no new lows,

while the Nasdaq recorded 35 new highs and 77 new lows.