Stocks are on track for their third consecutive year of significant gains, supported by easing inflation pressures and positive economic indicators. The S&P 500, Dow Jones, and Nasdaq closed higher, with the market buoyed by optimism about potential Federal Reserve rate cuts. The recent data shows the core personal consumption expenditures (PCE) price index, which excludes food and energy, rose by 0.2% monthly and 2.8% annually, slightly below expectations, indicating lower inflation. Personal income increased by 0.4%, and spending rose by 0.3%, aligning with forecasts. The market responded positively to the inflation report, with traders anticipating a 95% chance of a 25 basis point rate cut at the Fed's upcoming meeting. Additionally, consumer sentiment improved, with the University of Michigan index rising to 53.3 and inflation expectations declining to their lowest in 11 months. Despite rising bond yields, stocks gained momentum, supported by strong earnings reports from companies like Ulta Beauty and Rubrick. Overseas markets showed mixed results, with European and Chinese indices rising while Japan's Nikkei declined. Overall, the market remains optimistic amid signs of easing inflation and favorable economic data, though concerns about bond yields and global economic conditions persist.