US stocks surged on Wednesday, eyeing fresh record highs, as investors welcomed a soft reading on consumer prices, fueling hopes that the Federal Reserve may cut interest rates sooner than expected. The S&P 500 and Dow Jones Industrial Average both jumped about 0.4% at the open, while the tech-heavy Nasdaq Composite climbed about 0.5% after reaching a record close on Tuesday.

The Consumer Price Index (CPI) rose 0.3% over the previous month and 3.4% over the prior year in April, showing a deceleration from the previous month. In addition, "core" inflation, which excludes food and gas prices, grew at its slowest annual pace in 2024. These figures indicated that inflationary pressures might be easing, providing further support for the belief that the Federal Reserve could begin reducing interest rates from their current historic highs.

Furthermore, retail sales in April were flat, falling significantly short of Wall Street expectations. The stagnation in consumer spending raised concerns about the state of the economy, particularly in the face of sticky inflation and higher interest rates.

In another notable development, Netflix announced that it had secured the streaming rights for two National Football League (NFL) games scheduled to air on Christmas Day. This unexpected move by the streaming giant, which had previously expressed a reluctance to invest in live sports content, signifies a shift in its strategy. Netflix will reportedly pay less than $150 million per game, a deal that also includes streaming at least one holiday game per year as part of a three-season agreement.

Netflix's foray into live sports content is a departure from its focus on "sports entertainment," which includes docuseries and sports-adjacent content. Although Netflix had previously denied any interest in acquiring the rights to live sports, industry experts predict that the streaming platform may eventually expand its offerings to capture the lucrative sports market.

Meanwhile, meme stocks, such as GameStop and AMC, experienced a significant decline on Wednesday after a frenzied rally in recent days. GameStop's shares plummeted more than 25%, while AMC's stocks fell approximately 20%. The pullback in these meme stocks reflects a waning interest among investors and a potential end to the recent meme stock craze.

Overall, US stocks were on track for record closes if they maintained their gains throughout the trading session. The softer inflation data and the unexpected expansion of Netflix into live sports content have contributed to a resurgence in bullishness in the market.