Headline Consumer Price Index accelerated to 3.8% year-over-year in April from 3.3% prior, the highest reading since March 2023 and above the 3.7% consensus, driven largely by gasoline prices.
Core inflation also surprised to the upside at 2.8%, leaving the Fed widely expected to keep rates on hold throughout the year, while markets currently price in a roughly 30% probability of a 25-basis-point rate hike in December.
The 10-year Treasury yield jumped about 4 basis points to 4.46%, nearing March highs, while the 30-year yield breached the psychologically important 5.02% level and the 2-year traded near 4.0%.
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By Midday Tuesday…
Across U.S. equity markets, losses were broad-based but concentrated in technology and small caps. The Nasdaq 100 led the way lower as the semiconductor complex collapsed.
The S&P 500 fell 0.9% to 7,347, while the Nasdaq 100 sank 2.1% to 28,699 as the AI-infrastructure trade unraveled.
President Donald Trump criticized an Iranian counteroffer to end the war, and said the month-long ceasefire is “unbelievably weak”.
WTI crude climbed to $101.43 a barrel by midday, up 3.4%, while Brent rose 3.3% to $107.60.
Gold pulled back 1.4% to $4,671 per troy ounce as a stronger dollar and surging real rates trumped haven demand, with the SPDR Gold Shares (NYSE:GLD) tracking the move lower.
Tuesday’s Performance In Major US Indices
Index
Last
% Change
S&P 500
7,347.36
-0.9%
Dow Jones
49,557.51
-0.3%
Nasdaq 100
28,699.04
-2.1%
Russell 2000
2,804.90
-2.3%
Updated ...
