On Monday local time, the three major U.S. stock indexes collectively closed higher and hit new highs. As of the close, the Dow rose 337.47 points, or 0.71%, to 47544.59 points; the Nasdaq rose 432.59 points, or 1.86%, to 23637.46 points; the S&P 500 index rose 83.47 points, or 1.23%, to 6875.16 points.

The Nasdaq China Golden Dragon Index closed up 1.59%, and popular Chinese concept stocks rose collectively. Xpeng Motors and Pony.ai rose more than 6%, Baidu rose nearly 5%, Kingsoft Cloud rose more than 4%, JD.com and iQiyi rose more than 3%, and Alibaba rose more than 2%.

The rising expectations of a rate cut by the Federal Reserve are one of the reasons for the current strength in the U.S. stock market. According to the latest statistics from CME’s “Fed Watch”, the probability that the Federal Reserve will cut interest rates by 25 basis points in October is 97.3%, and the probability of keeping interest rates unchanged is 2.7%. The probability that the Federal Reserve will cut interest rates by a cumulative 50 basis points in December is 95.3%.

The U.S. September consumer price index (CPI) data released before the U.S. stock market opened last Friday was generally lower than market expectations, paving the way for the Federal Reserve to further cut interest rates. After the data was released, traders increased their bets that the Federal Reserve would cut interest rates twice more this year.