The S&P 500 moved up to set a new all-time closing high on Tuesday after several better than expected economic reports were released. Topping the list is retail sales which advanced 1.7% at the headline and core levels, both 0.2% above consensus. Elsewhere in the economy, business inventories rose more than expected as did the NAHB Homebuilder?s index which both suggest supply chain disruptions are easing.

The caveat is that, with the retail sales figures at least, all of the gains are due to inflation. With retail sales rising 1.7% and inflation up 6.2% economic activity is not expanding. Today traders will be on alert for reads on Building Permits and Housing Starts as well as an earnings report from major retailer Target.