(Updates with afternoon trading)

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Producer prices fall unexpectedly in August

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Oracle's forecast boosts chipmakers, power supply

companies

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Barclays, Deutsche Bank raise S&P 500 2025 year-end target

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S&P 500 +0.28%, Nasdaq +0.11%, Dow -0.59%

By Noel Randewich and Ragini Mathur

Sept 10 (Reuters) - The S&P 500 and the Nasdaq hit

intraday record highs on Wednesday, lifted by a surge in Oracle,

while cooler-than-expected inflation data supported expectations

the U.S. Federal Reserve will cut interest rates next week.

Oracle soared 38% and was set for its biggest

one-day percentage gain since 1992 after the tech company

pointed to a demand surge from AI firms for its cloud services.

Its stock market value reached $938 billion, leapfrogging

the values of Eli Lilly ( LLY ), JPMorgan Chase ( JPM ) and

Walmart ( WMT ), and approaching Tesla's $1.14 trillion

market value.

AI-related chip stocks also rallied, with Nvidia ( NVDA ) up

4.3%, Broadcom ( AVGO ) jumping over 8% and Advanced Micro

Devices ( AMD ) climbing 3.4%. The PHLX chip index rose

2.3% and hit a record high.

Data center power suppliers also benefited, with

Constellation Energy ( CEG ) and Vistra ( VST ) both advancing

about 9%, and GE Vernova ( GEV ) rising 6.2%.

A cooler-than-expected producer prices reading provided

additional momentum as traders shored up their bets on

interest-rate cuts this year.

Recent labor market data has confirmed the U.S. jobs market is

in a slowdown.

Traders fully expect the Fed to cut interest rates by at

least 25 basis points at its policy meeting next week, with a

10% chance the central bank could cut by 50 basis points, CME's

FedWatch tool showed.

The S&P 500 has now climbed 11% in 2025, while the Nasdaq

has rallied 13%.

"The fundamentals remain very strong in the equity markets,

domestically. But we also have to acknowledge that valuations

are extended at this point and serve as some natural tension to

a continued upward trajectory," said Bill Northey, senior

investment director at U.S. Bank Wealth Management in Billings,

Montana.

The S&P 500 was last up 0.28% at 6,530.99 points.

The Nasdaq gained 0.11% to 21,903.48 points, while the Dow

Jones Industrial Average was down 0.59% at 45,439.43 points.

Six of the 11 S&P 500 sector indexes declined, led lower by

consumer discretionary, down 1.31%, followed by a

1.28% loss in healthcare. The S&P 500 tech index

rose 1.7%.

Investors will now focus on consumer prices data due on

Thursday, for insights on where U.S. inflation is headed.

"Combining the softer data (PPI figures) with the Fed's

increased emphasis on the labor market side and the growing

trend we've seen in downward revisions to the monthly employment

data - all support the expectation for a rate cut," said Jordan

Rizzuto, CIO at GammaRoad Capital Partners.

In a setback for the White House, a federal judge on Tuesday

temporarily blocked U.S. President Donald Trump from removing

Fed Governor Lisa Cook.

Barclays and Deutsche Bank raised their year-end targets for the

S&P 500, citing stronger corporate earnings, resilient U.S.

economic growth and optimism around artificial intelligence.

Synopsys ( SNPS ) slid 35% and was set for its biggest one-day

decline on record after the chip design software provider missed

Wall Street estimates for quarterly revenue. Rival Cadence

Design Systems ( CDNS ) fell 8%.

Declining stocks outnumbered rising ones within the S&P 500

by a 1.9-to-one ratio.

The S&P 500 posted 19 new highs and 7 new lows; the Nasdaq

recorded 102 new highs and 54 new lows.