Dollar drops like a stone in July

The U.S. dollar dropped like a stone.

In July, the Consumer Price Index for All Urban Consumers was unchanged on a seasonally adjusted basis after rising 1.3 percent in June, the U.S. Bureau of Labor Statistics reported Wednesday. The all items index increased by 8.5 percent over the last 12 months. The figure would have been much higher if gasoline prices fell 7.7 percent in July.

Randy Frederick, vice president of trading and derivatives for Charles Schwab, told Reuters on Wednesday that inflation at 8.5 percent is still very high, but there is optimism that June may be the peak.

The Nasdaq Composite accelerated by 360.88 points or 2.89 percent to 12,854. The Dow Jones industrials surged 535.10 points or 1.63 percent to 33,309. The Standard and Poor's 500 increased by 87.77 points or 2.13 percent to 4,210, according to the Standard and Poor's 500. The U.S. dollar fell sharply on foreign exchange markets. The euro went to 1.0302 by the New York close Wednesday. The British pound went to 1.2203. The Swiss franc was up to 0.9428.

The U.S. dollar gained more than a cent to 0.7080. The CAC 40 in Paris climbed by 0.57 percent over the course of the day. The German Dax increased by 1.23 percent. The FTSE 100 rose by 0.25 percent in London.

The Hang Seng plunged 392.60 points or 1.96 percent to 19,610 in Hong Kong. In Japan, the Nikkei 225 dived 180.63 points or 0.65 percent to 27,819. The Australian All Ordinaries declined 39.90 points or 0.55 percent to 7,238. In New Zealand, the S&P NZX 50 fell 1.39 points or 0.01 percent to 11,752.