US stock market: US stocks ended sharply higher on Tuesday, with the S&P 500 registering a record high close as Oracle shares surged and consumer price data failed to dampen investors' hopes of interest rate cuts in the coming months.

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Shares of Oracle (ORCL.N) jumped 11.7 per cent and reached a record high, a day after it reported upbeat quarterly results and said it is set to make a joint announcement with artificial intelligence chip giant Nvidia (NVDA.O).

Nvidia shares gained 7.2 per cent and an index of semiconductors (.SOX) rose 2.1 per cent and snapped a two-day losing streak. The Labor Department reported that the Consumer Price Index (CPI) rose 0.4 per cent last month after climbing 0.3 per cent in January. Excluding volatile food and energy components, consumer prices increased 0.4 per cent in February after rising by the same margin in January.

"Investors have gotten comfortable with the notion that it's not about when the Fed will lower rates but rather by how much, and a delay - whether it happens in May like many were initially hoping or in September - ultimately doesn't matter," said Oliver Pursche, senior vice president and advisor for Wealthspire Advisors in Westport, Connecticut.

"It's that they will and that a less restrictive environment is coming." Traders now see a 70 per cent chance of the first rate cut coming in June, the CME FedWatch Tool showed, versus 71 per cent ahead of the inflation report.

The Dow Jones Industrial Average (.DJI) rose 235.74 points, or 0.61 per cent, to 39,005.4. The S&P 500 (.SPX) gained 57.3 points, or 1.12 per cent, at 5,175.24 and the Nasdaq Composite (.IXIC) added 246.36 points, or 1.54 per cent, at 16,265.64.

"If you look at economic data, it continues to be pretty strong," Pursche added. "And from my perspective as a consumer, employee and investor, I'd rather have a strong economy and slightly elevated interest rates than a weak economy that requires stimulus."

Producer price data is due later this week. On the downside, shares of Boeing (BA.N) fell 4.3 per cent. Boeing told employees in a memo on Tuesday it is adding weekly compliance checks for every 737 factory work area and additional audits of equipment to reduce quality problems.

The US Federal Aviation Administration has curbed Boeing production following the mid-air panel blowout on a new Alaska Airlines <ALK.N> 737 MAX 9 jet on Jan. 5. Also, US carriers warned that their plans to increase capacity were in doubt due to jet delivery delays from Boeing.

Shares of Southwest Airlines (LUV.N) were down 14.9 per cent. Volume on US exchanges was 10.97 billion shares, compared with the 12.07 billion average for the full session over the last 20 trading days. Advancing issues outnumbered decliners on the NYSE by a 1.28-to-1 ratio; on Nasdaq, a 1.20-to-1 ratio favored decliners. The S&P 500 posted 48 new 52-week highs and no new lows; the Nasdaq Composite recorded 59 new highs and 118 new lows.