The S&P 500 index rose to a record high Tuesday as July inflation data raised Wall Street's hopes for rate cuts.

The S&P 500 closed 1.1 percent higher, rising more than 70 points to close at a record high of 6,445.8. The Dow Jones Industrial Average and Nasdaq composite also rallied 1.1 percent and 1.4 percent, respectively.

Stocks rallied after the Bureau of Labor Statistics released new consumer price index (CPI) data showing inflation plateauing, largely in line with the projections of economists.

Prices rose roughly 2.7 percent on the year and 0.2 percent in June, according to the report, as falling gasoline prices wiped out increases in prices for airline tickets, used cars, medical care and other services.

The combination of plateauing inflation and meager job growth should give

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