May 14 Market Recap: PPI Surges 6%, Hitting a Three-Year High; Nasdaq Defies Trend to Reach All-Time High
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May 14 Market Recap: PPI Surges 6%, Hitting a Three-Year High; Nasdaq Defies Trend to Reach All-Time High
On the same day inflation surged, the market placed a political bet.
Navigating Web3 tides with focused insightsAuthor: TechFlow
If yesterday’s market took a hit from inflation data, today’s market took two hits—and still got up to dance, and danced to Tech House.
On May 13, another grim inflation report arrived. April’s Producer Price Index (PPI) surged 6% year-on-year—the largest gain since December 2022—and jumped 1.4% month-on-month, far exceeding the consensus forecast of 0.5%. Core PPI rose 4.4% YoY and 1.0% MoM—both the highest levels since early 2022.
Linking yesterday’s CPI (3.8%) with today’s PPI (6%), one sentence sums it up: Inflation isn’t retreating—it’s digging deeper. The Bureau of Labor Statistics (BLS) put it bluntly: nearly 60% of April’s MoM PPI increase stemmed from services—wholesale trade profit margins rose 2.7%, and transportation costs climbed 5%. This signals that tariff and energy costs are now cascading from upstream energy firms through midstream logistics and distribution—and are just one step away from landing on your final bill.
Logically, equities should have fallen on such data.
Yet today, the Nasdaq rose 1.2% to 26,402.34, and the S&P 500 gained 0.58% to 7,444.25—both hitting all-time highs. Only the Dow Jones Industrial Average dipped 0.14%.
This is the most intriguing part of today’s market: The inflation data slammed “economic fundamentals,” but the market isn’t betting on fundamentals—it’s betting on politics.
First, consider these eye-catching figures:
- Nasdaq: +1.20%, closed at 26,402.34—new all-time high
- S&P 500: +0.58%, closed at 7,444.25—new all-time high
- Dow Jones: −0.14%, closed at 49,693.20
- Russell 2000: +0.07%, closed at 2,844
Yet according to FactSet, roughly two-thirds of S&P 500 constituents declined.
In other words, today’s “all-time high” wasn’t broad-based strength—it was a narrow, AI-driven record propped up by just a handful of mega-cap stocks.
NVIDIA rose over 2%, Micron surged over 4%, and the VanEck Semiconductor ETF (SMH) gained 2%. Semiconductor stocks—which were hammered yesterday—rebounded sharply today. AMD and Qualcomm also largely stabilized after yesterday’s losses.
Meanwhile, on the Dow, Salesforce fell 2.81%, Home Depot dropped 2.52%, and communication and financial sectors declined—both highly rate-sensitive. The 10-year U.S. Treasury yield rose to 4.473%—its highest since July 2025—and both 20- and 30-year yields breached 5%, their highest since May 2025.
The bond market says, “No rate cuts this year—maybe even hikes.” The equity market replies, “I don’t care—I’m all in on the AI narrative.”
The root cause of this divergence is an event that hadn’t fully ripened last night—but ignited fully this morning: Jensen Huang, CEO of NVIDIA, boarded Air Force One at the last minute.
Here’s how it unfolded.
On Wednesday, Trump departed Washington for his first official visit to China in a decade, scheduled to meet President Xi Jinping within two days. Key agenda items include agricultural products, aircraft, rare earths, and maintaining the trade truce struck last October. The accompanying CEO delegation was widely assumed—not to include Jensen Huang.
But during a refueling stop in Anchorage, Alaska, Huang boarded Air Force One. Elon Musk was aboard too. On Truth Social, Trump described the delegation as “a group of brilliant people” and wrote: “I will ask President Xi to ‘open up’ China so these brilliant people can work their magic.”
Translated into market language, that means: The H200 chip export ban to China may be loosened.
This is NVIDIA’s biggest wound over the past three years. Six months ago, ahead of the Busan Xi-Trump summit on October 30, Huang lobbied hard to lift the Blackwell chip export ban—but Rubio, Greer, and Lutnick jointly blocked Trump from including it on the summit agenda. Huang’s “last-minute boarding” is a counteroffensive to that earlier defeat.
Buffett and veteran Wall Street investors know well: When a CEO personally boards Air Force One to negotiate contracts in a client country, the act itself is bullish—the outcome is secondary; the gesture precedes the result. NVIDIA rose 2.5% that day, lifting the entire semiconductor sector with it.
Oil: The $100 Battle—IEA Sounds a New Alarm
WTI crude futures hovered near $102 on Wednesday, briefly dipping below $102 before closing around $101–$102 per barrel. Brent traded near $107.
That oil “didn’t rise further” was itself one reason markets felt comfortable taking risk today—but the flip side is grimmer:
The International Energy Agency (IEA) warned in its monthly report released Wednesday that global observable crude oil inventories are declining at roughly 4 million barrels per day—the fastest pace on record. The IEA stated that even if the war ended today, oil markets wouldn’t rebalance until October.
The day before, Saudi Aramco CEO Amin Nasser claimed the world is “losing 100 million barrels of supply per week.” Today, the IEA added another blow: over the past two-and-a-half months, approximately 1 billion barrels of crude have vanished from the global supply ledger—the most direct and hardest-to-repair loss since the Middle East conflict began.
U.S. Energy Information Administration (EIA) inventory data echoed this: U.S. crude inventories plunged 4.3 million barrels last week—nearly double expectations.
Oil may briefly retest $100 in the short term—but this is a market supported simultaneously by “war premium” and “real shortage.” Until Iran ceases provocations or a genuine ceasefire takes hold, the logic that “breaking $100 is merely a pullback” will persist.
Gold & Silver: Diverging Paths
Gold fell for a second straight day Wednesday, closing at $4,696 per ounce—a 0.39% decline.
Silver, however, kept charging—surging intra-day to $88 per ounce, its highest level in two months.
Same asset class—opposite directions. This is today’s cleanest example of “narrative bifurcation.”
Gold fell because it’s a pure safe-haven asset—and hates rising real yields. With the 10-year Treasury yield hitting its highest since July 2025, and both 20- and 30-year yields crossing 5%, gold’s hedge logic has been undermined.
Silver rose because it’s half safe-haven, half industrial metal—used in AI data centers, solar panels, and electronics. On the same day NVIDIA hit a new high, silver rallied alongside the industrial-demand story.
India’s government raised import tariffs on gold and silver from 6% to 15% on Wednesday—an outright demand headwind in theory—but silver didn’t flinch. The market’s pricing of silver’s industrial attributes has clearly overtaken its safe-haven role.
Crypto: Trading Sideways—Handing Fate to Trump
“Waiting” was crypto’s keyword today.
Bitcoin traded in a tight range near $80,000—reporting ~$80,304 at 9 a.m. ET per Fortune. Ethereum hovered near $2,280, nearly flat. Total market cap stood at ~$2.77 trillion, with Bitcoin’s dominance holding steady near 58%.
But calm doesn’t mean safety.
First, technicals are in a crunch. CoinDesk analysis notes BTC is squeezed between its 200-day simple moving average and its 200-day exponential moving average. $82,000 is the critical resistance in this zone—both bulls and bears have committed all their ammunition here. A break above reignites the uptrend; a drop below tests $70,000.
Second, the tug-of-war between long-term holders and speculators is intensifying. On-chain data shows addresses classified as “conviction buyers” have increased their BTC holdings by 300% over the past six months—approaching 4 million BTC. Meanwhile, U.S. spot Bitcoin ETFs have seen net outflows of ~$4.5 billion year-to-date in 2026—the worst start since their January 2024 launch. One hand is the diamond-handed buyer accumulating on every dip; the other is the paper-handed seller cashing out on every rally. Today’s $80,000 price point is precisely where those two forces clash head-on.
Third, everyone is waiting for Trump-Xi. Crypto’s three-day consolidation reflects a collective stance: “I’ll hold off—let’s see what Beijing decides.” If the Trump-Xi talks yield a “big package”—including rare earths, AI chips, and extended trade truce—global risk appetite will surge, pushing BTC toward $82,000. If talks collapse—and compounded by Powell’s formal Friday departure and Warsh’s yet-to-be-confirmed succession—the $70,000 level will face a true stress test.
Notably, Coinbase demonstrated resilience amid broad carnage across crypto equities today, while Charles Schwab began offering retail clients access to spot Bitcoin and Ethereum trading. This infrastructure expansion is decoupled from price action—a structural tailwind, but no short-term price catalyst.
Today’s Recap: On the Day Inflation Blew Out, Markets Bet on Politics
May 13 saw markets respond to surging inflation with near-black humor:
U.S. Equities: PPI spiked 6%—a three-year high—yet the S&P 500 and Nasdaq both set new all-time highs. But only one-third of index constituents rose; the rally was entirely powered by NVIDIA + Huang’s “China narrative.”
Oil: WTI retreated to ~$102—but the IEA warned global crude inventories are vanishing at a record pace.
Gold/Silver: Gold slid to $4,696; silver surged to $88—its highest in two months—on industrial demand, marking the first clear split between safe-haven and industrial logic.
Crypto: Bitcoin traded sideways near $80,000; Ethereum held firm near $2,280—the entire market outsourced its trading decisions to Beijing’s conference room.
If talks succeed—even partially—e.g., H200 chip approvals, secured rare earth supply, extended trade truce—AI stocks will stage a comeback under the dual pressure of inflation and rising rates, and Bitcoin will likely target $82,000, testing its 200-day moving average resistance.
If talks fail—and compounded by Powell’s Thursday departure and policy vacuum—markets will confront a harsher reality: A cocktail of 6% wholesale inflation, 3.8% consumer inflation, oil above $100, and long-dated yields above 5% cannot be digested by one or two rallies.
But at least today, markets sent the Fed a message in red candlesticks: Even inflation must wait in line behind the AI narrative.
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