Alex Eule
Good Breadth. The semiconductor fever that sent chip stocks soaring in recent weeks finally seemed to break on Tuesday. Red-hot Intel fell as much as 11% on the day before closing down 6.8%. Qualcomm was down 11.5%. Nvidia was a rare gainer, up 0.6%. All told, the closely followed PHLX Semiconductor Index, better known as the SOX, slipped 3%.
The SOX had become a must-watch in recent weeks, as artificial-intelligence hype sent chip stocks to the moon. Before falling today, the chips index had soared 173% over the last year, according to my colleagues at Dow Jones Market Data, its best stretch since the 12 months ending on June 5, 2000.
Given those gains, it would be hard to chalk up today's moves to much more than profit taking. But there was certainly a different vibe on Wall Street, after weeks of exuberant trading and numerous record closes for the S&P 500 and tech-heavy Nasdaq Composite. They finished today down 0.2% and 0.7%, respectively.
It was a mirror image of recent trading patterns in which a few tech companies powered the S&P 500 higher. Despite today's overall loss, the large-cap index actually had more individual gainers than losers, with 259 stocks closing higher against 243 decliners. If you're a glass half-full type, you'll see this improved "breadth" as a good sign for overall market sentiment.
The outperformers today largely came from the consumer staples and healthcare sectors, which rose 1.6% and 1.9%, respectively. If you're a glass-half empty trader, you'll notice that those are risk-off trades. And there was plenty of reason to be paring back on risk today, with the cease-fire in Iran looking increasingly fragile and oil prices pushing higher. WTI crude, the U.S. benchmark, settled up 4.2%, to $102.18 a barrel. Regular unleaded gas prices around the country are now averaging $4.50 a gallon, according to AAA.
Rising prices were a theme on the day, with the latest consumer price index report showing higher-than-expected inflation in April. More on that below.
The Hot Stock: Meta Platforms +6.5% The Biggest Loser: Qualcomm -11.5%
Best Sector: Zebra Technologies +11.4% Worst Sector: Consumer Discretionary -1.1%
Inflation Anxiety
This Friday is Jerome Powell's last day as Federal Reserve chairman. The latest CPI report guarantees that Kevin Warsh, Powell's successor, will take the helm with the same worry that overshadowed most of Powell's tenure: inflation.
CPI rose 3.8% year over year in April, up from March's 3.3% gain. The core gains, which exclude energy and fuel, were more muted, up 2.8% on the month, versus 2.6% in March.
But consumers can't ultimately exclude energy and fuel from their budgets, and the costs are mounting. Gasoline is up 28% from April of last year. Airfare was a particular standout, with prices up 20.7% over the same period.
"The report is an unwanted welcome gift for Kevin Warsh, who is expected to take over as Fed chair this week and has recently advocated for lowering interest rates," wrote Barron's Fed reporter Nicole Goodkind.
"The conversation," Nicole added, "has shifted from when the Fed might cut rates to whether it might need to raise them if the war drags on.
Read more of Barron's CPI coverage here.
The Calendar
Alibaba Group, Cisco, and Nebius Group announce earnings tomorrow.
The Bureau of Labor Statistics releases the producer price index for April. The consensus estimate is for a 4.8% jump from a year earlier, compared with a 4% rise in March. The core PPI is predicted to increase 4.3%, half a percentage point more than previously.
What We're Reading Today
-- Kevin Warsh Confirmed as Fed Gov, Chair Vote Expected This Week
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(END) Dow Jones Newswires
May 12, 2026 19:55 ET (23:55 GMT)
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