CPI Reignites Inflation Fears! Even Nvidia Couldn’t Save Wall Street’s Fall From Grace

Market Overview

Hotter-than-expected U.S. CPI inflation data sent shockwaves through global markets, dragging both the S&P 500 and Nasdaq lower from record highs, while the Dow Jones barely managed to secure a third consecutive day of gains. Following the inflation release, the 30-year U.S. Treasury yield climbed back above the critical 5.0% threshold, as a resurgent U.S. dollar intensified pressure across risk assets.

Global markets were equally turbulent. In the UK, mounting concerns over Prime Ministerial stability and fiscal risks pushed the 30-year gilt yield to its highest level since 1998, triggering a sharp selloff in the British pound, which fell to its lowest level of the month.

■ Technology and Semiconductor Stocks Slide Sharply:

The semiconductor index plunged 3%, with Qualcomm tumbling more than 10%, while Intel and Sandisk dropped nearly 7% and 6%, respectively. Software shares also came under heavy pressure, with Salesforce declining over 3%. GitLab sank 10% after unveiling its AI restructuring initiative. Nvidia, however, once again demonstrated exceptional resilience, reversing intraday losses to close at a fresh all-time high. Chinese ADRs showed relative strength, led by JD.com, which gained more than 3% on stronger-than-expected revenue results.

■ Energy and Commodities:

Persistent tensions between the U.S. and Iran continued to support crude prices, with oil extending gains for a third straight session and reaching a one-week high. WTI crude surged nearly 5% intraday, while Brent crude climbed more than 4%. Precious metals remained under pressure from the stronger dollar, as gold futures posted a second consecutive decline. Silver futures rebounded after snapping a five-session winning streak. Copper markets delivered the most explosive performance, fueled by aggressive fund inflows that pushed both LME copper and COMEX copper to new record closing highs.

■ Bonds, FX, and Cryptocurrencies:

The U.S. Dollar Index advanced for a second straight day following the CPI release, climbing to its highest level in a week. The Japanese yen weakened for a second consecutive session, although suspected intervention triggered a brief intraday rebound. Offshore yuan briefly rallied toward 6.79 against the dollar, approaching a three-year high before paring gains. Bitcoin fell back below the $80,000 mark, retreating more than 2% from its daily high.

Market Outlook● U.S. April CPI Hits 3.8%, Highest Level in Nearly Three Years

The inflationary impact of the Iran conflict is increasingly filtering through the economy via higher energy, airfare, and transportation costs. Meanwhile, memory chip prices continue to spiral higher amid the intensifying AI race. In addition, the Bureau of Labor Statistics implemented a one-time adjustment to housing and rental data that had previously been distorted by last October‘s government shutdown, creating additional technical noise in this month’s report.

● The Feds New Chair Faces an Impossible Balancing Act

Incoming Federal Reserve Chair Kevin Warsh is set to officially assume office this week, but he is already confronting an extraordinarily difficult landscape. The Iran conflict has pushed inflation back toward 3.5%, while the FOMC is experiencing its highest level of dissent in three decades. At the same time, President Trump has publicly pressured the Fed to cut rates and has reportedly threatened legal action.

Cutting rates risks reigniting inflation, while holding policy steady could sharply escalate political tensions. This growing crisis surrounding central bank independence may ultimately reshape the global monetary policy framework.

Key Events to Watch (GMT+8)

20:30 US – U.S. April PPI YoY, U.S. April PPI MoM

22:30 US – EIA Crude Oil Inventories, Cushing Crude Inventories, and Strategic Petroleum Reserve Inventories for the week ending May 8