Markets pause as inflation surprises

Markets slip broadly after an inflation surprise, but Amazon and other Big Tech names keep the S&P 500 near flat.

Big Tech steadies Wall Street while most stocks fall

NEW YORK markets mostly fell on Thursday after a wholesale inflation report showed prices rising 3.3% from a year earlier, well above forecasters’ expectations. The S&P 500 was essentially unchanged at midmorning after setting an all time high the day before, while the Dow slipped about 79 points and the Nasdaq hovered near its record. The data complicates expectations for Fed rate cuts, as higher inflation could keep borrowing costs higher for longer and slow the economy.

On the earnings front, shares of Tapestry fell 14.5% as tariffs and duties cloud its profit outlook, despite a quarterly beat on revenue. Deere also dropped, down around 7.7%, amid cautious guidance for profits this year. In contrast, Fossil Group surged 17.1% after a stronger profit showing and a plan to strengthen its finances. Amazon rose 2.3% following news of same day grocery delivery in more than 1,000 cities, underscoring how mega cap tech can buoy the market even when most names slide. The 10 year Treasury yield climbed to about 4.26% as investors priced in a higher rate environment. Outside U S markets, stocks in Europe and Asia were mixed as traders looked ahead to political talks and global policy signals.

The day underscores a market built on concentration. A handful of megacap tech stocks can carry the broader index even as most individual shares fall. That dynamic means overall market health hinges on the fate of a few behemoths, not a broad rally in the rest of the market. Inflation data adds to the challenge for policymakers, suggesting the Fed may delay easing even as a strong job market argues for support. Tariffs and trade policy add another layer of risk for manufacturers and retailers, complicating earnings outlooks in sectors that rely on steady demand. In this context, soft signals from the Fed and policy twists abroad will likely keep guiding sentiment for weeks to come, more than any single quarterly report.

Highlights

Policy clarity will determine the next leg of the market journey