TL;DR

US CPI cools; equities and tech surge; yields volatile on debt worries; Trump, China agree tariff pause.

Highlights

• US April CPI rose 2.3% YoY (vs 2.4% expected), lowest since Feb 2021; core inflation steady at 2.8%1.
• Treasury yields volatile: 10-year at 4.5%, 30-year near 4.89%, as debt concerns persist despite softer inflation2.
• S&P 500 (+3.2%) and Nasdaq 100 (+4.3%) erased 2025 losses; Nasdaq 100 enters bull market7.
• Tech stocks rally: Tesla regains $1T market cap; Nvidia hits $3.1T; Amazon , Apple , Meta , Microsoft all up6.
• Goldman Sachs lowers US recession probability to 35%, now expects only one Fed rate cut in December; raises S&P 500 target to 6,10018.
• Trump announces 90-day tariff pause with China, and China agrees to open markets to US businesses3.
• US rescinds Biden-era AI chip export rule, warns on Huawei chip use, signals more open AI tech exports to allies4.
• Trump, Saudi Arabia sign $600B investment pact and $142B arms deal; Nvidia to supply 18,000 AI chips for Saudi AI factory1115.
• Microsoft to cut 6,000–7,000 jobs (3% of workforce) to streamline operations and focus on AI5.
• First Solar upgraded to Outperform (target $221) on IRA benefits and favorable tax bill; solar/wind stocks rally20.
• Robinhood to acquire WonderFi (C$250M) for Canadian crypto expansion; VanEck launches tokenized US Treasury fund ($VBILL)914.
• Geopolitical risks: Israel preps major Gaza operation, strikes hospital bunker; Russia launches hypersonic missiles at Odesa, Ukraine121613.

Commentary

A softer-than-expected US April CPI print (2.3% YoY vs 2.4% expected) provided a tailwind for equities, helping the S&P 500 and Nasdaq 100 erase year-to-date losses17. The Nasdaq 100 is now in a technical bull market, with mega-cap tech names leading gains—Tesla reclaimed a $1T market cap, Nvidia hit $3.1T, and Amazon , Apple , Meta , and Microsoft all posted strong advances6. The rally has been further supported by Goldman Sachs lowering recession odds to 35%, raising its S&P 500 target to 6,100, and now anticipating only one Fed rate cut (in December)18.

Despite the equity strength, Treasury yields remain elevated and volatile, with the 10-year at 4.5% and the 30-year near 4.89%, reflecting continued concerns over US fiscal sustainability and the $36T national debt2. While CPI data briefly pushed yields lower, persistent debt and deficit worries are keeping upward pressure on rates, which could limit equity upside if yields move above key resistance levels2.

Policy developments are in focus: the Trump administration’s 90-day tariff pause and China’s market-opening pledge have eased some trade tensions, benefiting US multinationals3. The rescinding of Biden-era AI chip export restrictions, paired with new guidance on Huawei, signals a more open approach to US AI technology exports for allies, supporting the sector’s momentum4. Major US-Saudi deals—including a $600B investment pact, a $142B arms agreement, and Nvidia ’s AI chip supply to Saudi AI factories—underscore deepening US-Middle East economic and tech ties1115.

Sector-wise, First Solar and renewables rallied on an Outperform upgrade and a less restrictive draft tax bill20. Microsoft ’s 3% workforce reduction highlights ongoing cost discipline and AI investment focus5. In digital assets, Robinhood ’s WonderFi acquisition and VanEck ’s launch of a tokenized Treasury fund ($VBILL) reflect continued institutional expansion into crypto and blockchain-based products914.

Geopolitical risks remain elevated, with Israel preparing a full-scale Gaza operation and Russia escalating missile attacks on Ukraine1213. These developments could impact energy and defense stocks and inject headline risk into broader markets. Traders should monitor yield levels, sector rotation, and any late-session moves tied to geopolitical headlines.