Tech carries Wall Street to records, even as most stocks fall after discouraging inflation data

Wall Street closed at record levels Wednesday after technology stocks rallied, offsetting broader market declines triggered by fresh inflation concerns. The S&P 500 rose 0.6% to 7,444.25, surpassing its prior all-time high, while the Nasdaq composite climbed 1.2% to a new record at 26,402.34. The Dow Jones Industrial Average dipped 0.1% to 49,693.20, marking a rare decline amid the tech-driven gains. Nvidia led the S&P 500’s advance with a 2.3% rise, buoyed by AI demand, while Micron Technology and On Semiconductor jumped 4.8% and 11.1%, respectively, after a prior day’s pullback. The rally contrasted with broader market weakness, as most non-tech stocks fell on mounting inflation pressures. Wholesale inflation data released Wednesday showed prices rising faster than expected, following Tuesday’s report of accelerating consumer-level inflation. Rising fuel and transportation costs—exacerbated by tariffs, adverse weather, and geopolitical tensions—drove the increases, with oil prices remaining elevated despite a 2% drop to $105.63 per barrel. The International Energy Agency noted global oil inventories were depleting at a record pace, dampening hopes for Federal Reserve interest rate cuts this year. The yield on the 10-year Treasury edged up to 4.47%, reflecting higher borrowing costs that weighed on dividend-heavy sectors like utilities and real estate. American Electric Power fell 3% after announcing a $2.6 billion stock offering, while Birkenstock Holding dropped 12.9% due to U.S. tariffs hurting its latest quarterly results. Analysts warned that corporate earnings and AI momentum were sustaining markets, but rising inflation and oil prices were creating significant headwinds. Internationally, stock indexes rose across Europe and Asia, with South Korea’s Kospi leading gains at 2.6%. Meanwhile, Japan’s SoftBank Group reported a near fivefold profit increase for the year through March, driven by AI investments, while China’s Alibaba saw its U.S.-traded stock rise 8.2% despite mixed quarterly results. The Federal Reserve’s potential next move remains uncertain, with traders now pricing in a higher likelihood of rate hikes rather than cuts amid persistent inflationary pressures.