Stocks rose Tuesday following the release of fresh U.S. economic data, while investors waited for another key inflation report.

The Nasdaq Composite gained 0.75% and notched a fresh closing record of 16,511.18. The Dow Jones Industrial Average added 126.60 points, or 0.32%, to end at 39,558.11. The S&P 500 added 0.48%, closing at 5,246.68.

The producer price index reading for April came in above estimates, putting a damper on expectations that the Federal Reserve would begin cutting rates later this year. The PPI gained 0.5% from the prior month, higher than the 0.3% that economists polled by Dow Jones had anticipated.

The market’s initial reaction was negative, but moves were contained as the March wholesale prices reading was revised down to show a 0.1% decline. That was enough to ease concerns about stubbornly high prices. Traders may also be hesitant to overreact to this report ahead of the more closely followed consumer price index, due to be released Wednesday.

At this point, some investors may not have fully priced in the possibility that inflation will persist at these higher levels, said Megan Horneman, chief investment officer at Verdence Capital Advisors.

“The market is a little bit complacent — they’ve gotten accustomed to dovish rhetoric from Powell,” she said. “In our opinion, the longer this market continues to ignore what’s going on in the inflation category, the bigger decline we can see at some point.”

Traders also reacted to comments from Federal Reserve Chair Jerome Powell, who said on Tuesday that the U.S. central bank will need to practice patience in the face of higher-than-expected inflation.

The Dow is coming off its first losing session in nine, snapping its longest winning streak since December. The S&P 500 also inched lower on Monday, while the Nasdaq rose slightly. Stocks were pressured by a Monday report from the New York Federal Reserve that consumers’ expectations for inflation over the short and long term grew in April.