5 things you need to know before the stock market opens on Wednesday

Below are five key things investors need to know as they begin their trading journey:

Stocks rose on Tuesday, boosted by encouraging news on inflation (more on that below). The Nasdaq Composite soared 2.43% and the S&P 500 rose 1.68%. Meanwhile, the Dow Jones Industrial Average ended the day up 408 points, or 1.04% higher. The S&P 500 has recouped some of its recent losses and is now less than 5% away from its all-time high set in July. In fact, all three major averages are back above their Aug. 2 closing level, where they were before the dramatic global market sell-off on Aug. 5. Volatility has also eased since then, with the CBOE Volatility Index (VIX) hovering below 20 on Tuesday after soaring above 65 last week. Follow live market updates.

Starbucks Shares got a boost on Tuesday, rising nearly 25% after the company announced that Chief Executive Officer Laxman Narasimhan was leaving and Chipotle Chief Executive Brian Niccol was set to take over. That was the best day ever for the stock. Narasimhan, who became CEO in March 2023, stepped down effective immediately; Niccol will start on Sept. 9. The coffee giant has seen its performance struggle this year with poor sales in the U.S. and China. Chipotle shares, meanwhile, fell more than 10% following news that Niccol would leave after a successful tenure leading the burrito chain through a foodborne illness scandal and the pandemic.

The producer price index released Tuesday showed wholesale inflation rose less than expected in July. The core CPI reading, which excludes the volatile food and energy components, was unchanged. Dow Jones consensus estimates were looking for 0.2% increases for both readings. The headline CPI rose 2.2% year over year, which was a significant drop from June’s 2.7% reading. Investors will now turn their attention to the July consumer price index report, due out Wednesday at 8:30 a.m. ET. Economists polled by Dow Jones expect a similar 0.2% increase for the all-item CPI reading as well as the core measure. A positive CPI reading could ease some pressure on the Federal Reserve and allow the central bank to focus on other economic challenges, such as a slowing labor market.

Google On Tuesday, Google unveiled new artificial intelligence features that will use the company’s Gemini AI assistant and be available on its Android devices. The tech giant also announced the latest line of its Pixel phones. The Pixel 9 series, which starts at $799, will have a brighter display for viewing in direct sunlight, as well as more memory to support AI features. Google also announced the Pixel Watch 3, which has new features including AI-powered workout recommendations. Google, which doesn’t make much money from its hardware business, is aiming to introduce its new AI to consumers before Apple rolls out its AI on iPhones, Macs and iPads later this year.

Mortgage rates have dropped dramatically in recent weeks, and now homeowners are taking advantage. The Mortgage Bankers Association’s seasonally adjusted index showed that home refinance applications rose 35% last week, compared to the week before. They were up 118% compared to the same week last year. It took a while for homeowners to notice. Rates only dropped 1 basis point last week, but they’re down 33 basis points over the past four weeks and are 62 basis points lower than the same week last year. The refinance share of mortgage activity rose to 48.6% of total applications, up from 41.7% the week before, as homebuyers still face high prices and low supply.

— CNBC’s Brian Evans, Jesse Pound, Amelia Lucas, Rohan Goswami, Jeff Cox, Jennifer Elias and Diana Olick contributed to this report.