Wall Street stock indices were mixed on Wednesday following report of a sharp spike in April inflation, coinciding with US President Donald Trump’s arrival in Beijing for a high-stakes summit with Chinese leader Xi Jinping.
As of 10:45 a.m. Eastern Time, the S&P 500 was virtually unchanged, the Dow Jones Industrial Average was down 0.4%, and the Nasdaq Composite was 0.4% higher.
At 09:45 a.m. ET, the Dow Jones Industrial Average fell 249.05 points, or 0.50%, to 49,511.51, the S&P 500 lost 13.91 points, or 0.19%, to 7,387.05 and the Nasdaq Composite gained 3.40 points, or 0.01%, to 26,091.60.
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Wall Street indices were mixed due to a sharp spike in April inflation and geopolitical tensions related to US President Donald Trump’s arrival in Beijing for talks with Chinese leader Xi Jinping.
The Producer Prices Index (PPI) surged 6.0% for the year ending in April, significantly outpacing forecasts. This data highlighted mounting economic pressure, filtering through the American market due to rising oil prices.
Nvidia shares rose 1.7% and Micron Technology shares soared 5%. These tech stocks gained amidst a generally mixed market performance.
The US-Israeli conflict with Iran has led to a leap in oil prices, filtering through the American market and threatening to intensify inflationary pressure. This complicates the Federal Reserve’s upcoming monetary policy maneuvers and has pressured gold prices.
India raised import tariffs on gold and silver from 6% to 15% to reduce demand and alleviate pressure on the currency. This move is expected to help reduce the trade deficit and support the rupee.
About 15 minutes into trading, the Dow Jones Industrial Average was down 0.5% at 49,525.78. The broad-based S&P 500 slipped 0.2% to 7,386.93, while the tech-rich Nasdaq Composite Index lost less than 0.1% at 26,078.63.
According to Department of Labor statistics, wholesale prices Producer Prices Index (PPI) surged 6.0% for the year ending in April. Monthly growth figures significantly outpaced forecasts, reaching their steepest levels since March 2022.
This data highlights the mounting economic pressure as the leap in oil prices — triggered by the US-Israeli conflict with Iran — filters through the American market.
Trump touched down in the Chinese capital joined by a high-profile delegation, including Tesla’s Elon Musk and Nvidia’s Jensen Huang. Key issues such as trade, Taiwan, and Iran are expected to dominate the long-awaited discussions, which Trump had previously postponed from March due to the ongoing Middle East hostilities.
Crude oil prices ticked slightly upward on Wednesday, extending a three-day rally as market participants remained on edge for fresh developments regarding Iran.
Wall Street remains cautious, fearing that a protracted conflict could maintain high energy costs. Such a trend threatens to intensify inflationary pressure, further complicating the Federal Reserve’s upcoming monetary policy maneuvers.
In the bond market, the yield on the 10-year Treasury rose to 4.48% from 4.46% late on Tuesday.
Key Stock Movers
Tech stocks gained with Micron Technology rising 5% and On Semiconductor up 9%.
Shares of Nvidia, the AI chip giant, rose 1.7%.
Birkenstock Holding shares tumbled 13.6% after the company said its results for the latest quarter were hurt by US tariffs.
Bullion
Gold prices fell for a second straight day on Wednesday, as concerns over war-driven inflation dampened market hopes for imminent interest rate reductions.
At 09:05 a.m. EDT (1305 GMT), spot gold was down 0.6% to $4,686.99 per ounce. US gold futures gained 0.2% to $4,694.70.
Among other metals, spot silver fell 0.2% to $86.70 per ounce. Platinum lost 0.3% to $2,120.20. Palladium was down 0.4% at $1,484.10.
“Inflation remains sticky and so, the expectations for higher rates for longer was reinforced, and that’s been pressuring gold the last two days,” said Peter Grant, vice president and senior metals strategist at Zaner Metals.
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