U.S. stocks mostly pulled back Tuesday as a hotter-than-expected core inflation reading and another jump in oil prices cooled the recent rally, especially in high-flying semiconductor names.
U.S. stocks mostly pulled back Tuesday as a hotter-than-expected core inflation reading and another jump in oil prices cooled the recent rally, especially in high-flying semiconductor names. Treasury yields rose as investors delayed hopes for Fed easing, while crude climbed above $102 amid continuing Iran-related supply concerns. The Dow held slightly higher, but the S&P 500 slipped from record levels and the Nasdaq weakened as tech momentum faded.
Key Headlines & Market Movers:
Core Inflation Keeps Fed Cautious: April CPI showed headline inflation accelerating on higher energy and food costs, while core inflation rose more than expected and reached its highest level since September. The report reinforced the view that rate cuts are off the table for now, though the data were not strong enough to make near-term rate hikes the base case. The 10-year Treasury yield moved higher to roughly 4.46%, adding pressure to growth stocks and other rate-sensitive areas.
Oil Surge Complicates the Macro Picture: Crude prices extended Monday’s gains after President Trump rejected Iran’s response to a U.S. proposal to end the war, keeping geopolitical risk firmly in focus. West Texas Intermediate rose above $102 a barrel, raising concerns that energy costs could continue feeding into inflation in May. Strategists noted that higher gasoline prices are already weighing on consumers and could challenge optimistic earnings expectations if discretionary spending weakens.
Chipmakers Lead the Equity Pullback: Semiconductor stocks bore the brunt of the selloff after a sharp six-week rally left the group vulnerable to profit-taking. Intel, Micron, and Qualcomm sold off sharply, while Nvidia was a relative bright spot after touching another record high. Elsewhere, Under Armour, Hims & Hers, and GitLab fell on weak results, guidance, or restructuring news, while eBay rose after rejecting GameStop’s unsolicited takeover offer.
S&P 500 Sector Performance
Looking Ahead
Markets will turn next to the Beijing summit between President Trump and Chinese leader Xi Jinping, where trade discussions are expected to be a central focus, and to the Senate vote on Kevin Warsh’s nomination as the next Federal Reserve Chair. Investors will be watching whether geopolitical developments keep oil elevated, whether yields break above the recent range, and whether tech leadership can stabilize after Tuesday’s semiconductor-led pullback.
The Investment Management Group at Duncan Williams Asset Management is led by a team with extensive experience in investment management, financial planning, and client service. President David Scully, CFA®, CFP®, has more than 20 years of experience and is active in Memphis civic organizations. Chief Investment Officer Kyle Gowen, CFA®, CFP®, oversees investment strategy and is engaged with the local community. Investment Analyst Jack Eason, CFA®, provides research and supports charitable initiatives. The IMG team is committed to professional standards, client service, and community involvement. No statement is intended as an offer of investment advice or a guarantee of future results.
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