The S&P 500 and the Nasdaq Composite reached all-time highs late June, thanks to renewed AI enthusiasm, hopes of U.S. trade deals and rising bets on interest rate cuts, which helped drive a turnaround in U.S. stocks from a sharp rout earlier this year.

The Dow on Friday was on pace to hit its first record high of the year, reflecting steady optimism on Wall Street despite signs of underlying turbulence in the economy.

US stocks rose amid increasing expectations that the Federal Reserve will cut interest rates at its next meeting, following the latest inflation data.