Today's market action is mixed, with inflation and bond yields still the main drag, but tech/AI names are holding up better.
1. US & Global Equities
- US: The S&P 500 and Nasdaq had a rough session 10 days ago, down 1.24% and 1.54% respectively. More recent trading shows the S&P 500 and Nasdaq hitting new records, up 0.6% and 1.2% on a Wednesday, driven by a tech rebound. The Dow was slightly down 0.1% that day.
- Europe/Asia: STOXX 600 fell 1.48%. Asia-Pacific shares outside Japan dropped 2.5%. Japan’s Nikkei slid 1.99% after hotter wholesale inflation. South Korea’s Kospi fell 6% in one session.
- India: Nifty 50 was up 0.26% to 24,155.20 and Sensex up 0.12% to 77,399.34 in the last data I have.
2. Inflation & Bonds
- Inflation: US CPI hit 3.8% YoY in April, highest since May 2023. PPI surged 1.4% MoM, nearly triple expectations.
- Yields: 10-year US Treasury yield hit ∼4.48%, near its highest since last July. UK 30-year yield hit highest since 1998. Higher yields are pressuring stocks.
3. Sectors & Themes
- Tech/AI: Still the main driver. Despite the pullback, AI optimism is offsetting inflation fears. Qualcomm -11.5%, Intel -7%, SOX index -3% on one down day, but tech led the rebound to new highs later.
- Energy/Commodities: Oil jumped, WTI back above $100/bbl, +4% in one session. Gold and silver were down slightly more recently.
- Crypto: XRP and BNB around 82.5B market cap each.
4. Key drivers right now
- Inflation passthrough: Markets are watching if higher PPI flows into CPI/core inflation.
- Fed: Kevin Warsh confirmed as Fed Chair, replacing Jerome Powell. Rate cut expectations are mixed with inflation still high.
- Geopolitics: US-China summit, Middle East tensions, and Iran ceasefire status are moving sentiment.
Bottom line: Risk-on in tech/AI is keeping US indices near highs, but sticky inflation and rising yields are creating volatility globally. If you’re looking at US large caps, the trend is still up but choppy. International markets are weaker.
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