The S&P 500 index closed higher today, with a boost from the technology sector offsetting investor disappointment over the early morning inflation report, which dashed hopes that the Federal Reserve would cut interest rates by 50 basis points next week.

The S&P 500 technology index reversed course, recovering from a lower open thanks to a strong boost from AI chipmaker Nvidia, which rose 6.3%. Semafor reported that the U.S. government is considering allowing Nvidia to export advanced chips to Saudi Arabia.

Political developments also influenced market sentiment the day after Democratic candidate Kamala Harris put her Republican rival Donald Trump on the defensive in a heated US presidential debate.

Earlier, the Labor Department reported that the consumer price index (CPI) rose 0.2% last month, in line with July’s reading. The core CPI, excluding volatile food and energy components, rose 0.3% on a monthly basis, beating economists’ expectations for a 0.2% increase.

According to the CME Group’s FedWatch tool, the Fed is expecting a 25 basis point probability, which was cut to 85 percent from 66 percent on Tuesday. The probability of a 50 basis point rate cut fell to 13 percent from 34 percent the previous day.

“Perhaps the market has been waiting for a lower inflation rate, which would give the Fed another reason to cut rates by 50 basis points next week,” said Jack Janasiewicz, portfolio manager at Natixis. “This report was in line with or even slightly better than expected. As a result, the Fed is under pressure to cut rates by only 25 basis points.”

As the day went on, investors may have come to terms with the inflation numbers, according to Janasiewicz, while also pointing to technology as a standout product “that helped support the broader market.”

According to preliminary data, the S&P 500 gained 56.42 points, or 1.03%, to close at 5,551.94, while the Nasdaq Composite gained 365.06 points, or 2.14%, to 17,390.94. The Dow Jones Industrial Average rose 101.43 points, or 0.25%, to 40,838.39.

During the session, major US banks extended their losses from Tuesday, triggered by warnings of falling trading revenues, a slower-than-expected recovery in investment banking and expected impacts on interest income as a result of looming interest rate cuts.

After the presidential debate, the odds for a Trump victory on the online betting site PredictIt were 48 cents and for a Harris victory were 55 cents.

As a result, stocks expected to perform well under a Trump presidency fell. Cryptocurrency and blockchain-related stocks, as well as prison operators, saw declines. Shares of Trump Media & Technology Group plummeted.

Meanwhile, solar stocks, which are likely to benefit from a Harris administration, attracted some buyers, with shares of First Solar, Sunrun and SolarEdge Technologies all recovering.

While the debate on Wall Street provided little clarity on key policy issues, some market observers fear that Harris’ proposals to raise corporate taxes are likely to come at the expense of corporate profits, while Trump’s tougher stance on tariffs could fuel inflation.

GameStop shares fell sharply after the video game retailer filed an offering of up to 20 million shares and reported a decline in second-quarter sales.

Shares of lithium mining companies jumped after Chinese battery giant CATL announced it would make adjustments to lithium carbonate production in Yichun. Albemarle, one of the world’s largest lithium miners, also saw its share price jump.