US Stocks Mixed, Tech Gains as Producer Inflation Heats Up
US stocks were mixed, with the technology sector again outperforming the broader sector decline. The S&P 500 and Nasdaq edged higher, while the Dow fell about 200 points, amid a tug-of-war between faster inflation data and the ongoing AI-driven rally.
Pressure came from a higher-than-expected surge in April's producer inflation, particularly for energy-exposed goods and non-energy services. This development reinforces signals that the impact of the Middle East war is beginning to spread beyond direct fuel costs to broader price components in the economy.
This coincided with a renewed increase in refined fuel prices this week, in line with the continued blockade of tankers in the Persian Gulf. On the transmission side, rising input and service costs pose a risk of maintaining inflationary pressures, which could tighten policy expectations and pose a drag on capital-sensitive sectors.
However, the AI narrative remains a key driver of the index, driven by the perceived strong profit outlook from software and hardware manufacturers. Hyperscalers rallied in the pre-market after SoftBank announced a surge in profits from its private stake in OpenAI, while Nvidia rose 2.5% after CEO Jensen Huang joined the US delegation at a summit with China.
Looking ahead, the market is likely to monitor whether producer price pressures spill over into upcoming inflation data, energy price dynamics and supply disruptions in the Persian Gulf, as well as the continuation of AI catalysts through corporate performance guidance and developments in the US-China agenda, which could potentially impact tech sector sentiment.
Source: Newsmaker.id
