US producer prices surged in April, far exceeding economist forecasts and sparking a rally in semiconductor stocks amid broader market weakness.
Wall Street Shows Mixed Results
On May 13 local time, around 9:40 a.m., the Dow Jones Industrial Average declined by about 0.5% to 0.6%. The S&P 500 index edged lower from the previous session, while the Nasdaq Composite posted gains, propelled by strength in technology shares.
April PPI Exceeds Expectations
Producer Price Index (PPI) data for April revealed a 1.4% month-over-month increase, surpassing the anticipated 0.5% rise. This represents the sharpest monthly gain since March 2022. The prior year’s annual rate stood at 6.0%, and core PPI—stripping out volatile food and energy components—climbed 1.0% month-over-month, topping prior full readings.
Analysts expect similar upward pressure in the Consumer Price Index (CPI). Officials warn this development heightens inflation concerns, raising the odds of Federal Reserve interest rate hikes.
Semiconductor Sector Leads Gains
Semiconductor stocks gained ground despite inflation worries. Nvidia shares rose 1% to 2%, with peers like Micron Technology also advancing. Investors highlight Nvidia’s dominant position in AI chip manufacturing as a major growth catalyst.
Reports indicate Nvidia CEO Jensen Huang congratulated President-elect Donald Trump and joined his presidential transition schedule, further lifting market sentiment.
Commodities Climb on Geopolitical Tensions
Commodity markets reflected inflation fears. West Texas Intermediate (WTI) crude for June delivery traded above $102 per barrel after rebounding. Escalating Middle East tensions, including Israel-Iran conflicts, alongside US-Iran frictions, underpin the upward pressure.
European Markets Mostly Higher
Major European indices largely advanced. Germany’s DAX and Euro Stoxx 50 posted gains, though France’s CAC 40 recorded declines.
