May CPI accelerated to 4.2% y/y—a 3-year high compared to 3.8% a month earlier, but within expectations. Energy contributed over 60% of the growth: gasoline +41% y/y, diesel +59%, electricity +5.9%.
Core inflation was +0.2% m/m (below the forecasted +0.3%), so Treasury yields barely changed (10-year notes around ~4.53%). The market has priced out bets on a Fed rate cut; the focus is now on potential hints at a rate hike and Kevin Warsh's first press conference.
Futures are declining: S&P 500 −0.5%, Nasdaq-100 −0.9%, Dow −0.5%. Pressure was amplified by Trump's post about Iran ("will pay a price") following clashes in the Persian Gulf. Brent is above $92, WTI is around ~$89.
The AI sell-off continues independently of macro factors:
Slok (Apollo) points out the risk of individual stocks hitting records due to 0DTE options on Big Tech.
The SpaceX IPO is draining liquidity—some retail investors are exiting gold. Gold fell to $4176 (−20% from its peak), and silver is around ~$64 (−45%).
Dow Transports dropped for the first time in 6 sessions: Amazon (AMZN) is expanding its freight shipping services to third parties. FedEx Freight (FDX) −6.6%, Old Dominion (ODFL) −5.6%, XPO (XPO) −4.1%, iShares Transportation (IYT) −2.2%. Up next is Oracle's (ORCL) earnings report.
