On the heels of weaker-than-expected July CPI data, a feeling that we've reached peak inflation is driving the stock market rally today. There was some volatile action in the early going, but confined within a narrow range, before the market lifted to session highs. The main indices have given back some gains recently, currently moving sideways. The S&P 500 is flirting with the 4,200 level today, currently trading just below that.Both total CPI and core CPI, which excludes food and energy, came in below consensus, which renewed the belief that the Fed will take a less aggressive rate-hike path in coming months and potentially pivot to a rate-cut cycle sooner rather than later. Total CPI was unchanged month-over-month and core CPI was up 0.3%. This notion first registered in the Treasury and fed funds futures markets. Treasury yields moved sharply lower immediately after the release. The 2-yr note yield, which was at 3.27% before the release, is down 14 basis points to 3.12%. The 10-yr note yield is down four basis points to 2.76%. The fed funds futures market was pricing in a 32.0% probability of a 50-basis point rate hike at the September FOMC yesterday. After the July CPI release, that view has shifted markedly. The fed funds futures market now sees a 60.5% probability of a 50-basis point rate hike at the September FOMC meeting, according to the CME FedWatch Tool.Today's buying has been broad-based to this point in the session with the mega caps, growth stocks, and cyclical sectors leading the charge. The Vanguard Mega Cap Growth ETF (MGK) is up 2.5% versus a 2.1% gain in the Invesco S&P 500 Equal Weight ETF (RSP) and a 1.9% gain in the S&P 500. The Russell 3000 Growth Index (+2.3%) is outpacing the Russell 3000 Value Index (+1.7%).  Semiconductors are having a strong showing after selling off sharply recently. The PHLX Semiconductor Index is up 3.3% with nearly every component in the green. Also, the countercyclical sectors are lagging with utilities (-0.2%), consumer staples (+0.6%), and health care (+0.6%) trailing the broader market. Energy (+0.9%) is another relative underperformer but has improved during the session as oil prices have rebounded above $91.00/bbl.Reviewing overnight developments:Total CPI was unchanged month-over-month (Briefing.com consensus +0.2%), leaving it up 8.5% year-over-year versus 9.1% in June. Core CPI, which excludes food and energy, was up 0.3% month-over-month (Briefing.com consensus +0.5%), leaving it up 5.9% year-over-year versus 5.9% in June. The key takeaway from the report is that it supports the peak inflation view, which in turn supports the market's hope that the Fed will temper its aggressive rate-hike approach in coming months and ultimately transition to a rate-cut cycle in 2023, perhaps as early as the first half of 2023.Weekly MBA Mortgage Applications Index showed 0.2% increase versus the prior increase of 1.2%.June Wholesale Inventories rose 1.8% (Briefing.com consensus 1.9%) versus the prior revised increase of 1.9% (from 1.8%).