SG Morning Brief | PPI Shocks at 6% YoY but S&P, Nasdaq Hit Records; Warsh Confirmed as Fed Chair
US OvernightThe S&P 500 rose 0.58% to a record 7,444.25, and the Nasdaq surged 1.20% to a record 26,402.34, both shrugging off a stunning April PPI report. The Dow fell 67.36 points (-0.14%) to 49,693.20. April producer prices jumped 1.4% MoM (vs +0.5% est) and 6% YoY — the biggest wholesale price surge since 2022. Core PPI rose 1.0% MoM (vs +0.3% est). The 10-year Treasury yield hit 4.
US Overnight
The S&P 500 rose 0.58% to a record 7,444.25, and the Nasdaq surged 1.20% to a record 26,402.34, both shrugging off a stunning April PPI report. The Dow fell 67.36 points (-0.14%) to 49,693.20. April producer prices jumped 1.4% MoM (vs +0.5% est) and 6% YoY — the biggest wholesale price surge since 2022. Core PPI rose 1.0% MoM (vs +0.3% est). The 10-year Treasury yield hit 4.473%, its highest since July 2025, and the 20-year and 30-year yields crossed 5% for the first time since May 2025. CME FedWatch now shows just a 3% chance of any rate cut in 2026 and a 36% chance of a rate hike. Kevin Warsh was confirmed as Fed Chair by the Senate in a party-line vote; he takes over when Powell's term ends Friday. Despite the inflation shock, chip stocks rallied as Bloomberg reported Jensen Huang joined Trump in Beijing for a two-day summit with Xi Jinping. Morgan Stanley raised its S&P 500 year-end target to 8,000.
Key Movers
Ford (F) +13% — Ford surged 13.2% to $13.71, its biggest one-day jump in six years, after Morgan Stanley called the automaker's energy storage business and its partnership with Chinese battery giant CATL an "underappreciated" competitive advantage. Ford is spinning out a new Ford Energy subsidiary. Volume hit 216 million shares — more than 3x the daily average.
Alibaba (BABA) +8% — Alibaba rallied 8.2% to $145.81 despite missing quarterly revenue estimates (243.4B yuan vs 247B yuan est) and posting an 84% drop in adjusted EBITA. The stock was driven by Trump's arrival in Beijing for summit talks with Xi, which boosted China-exposed names across the board.
Nvidia (NVDA) +2% — Nvidia rose 2.3% to a new all-time closing high of $225.83 after Bloomberg reported CEO Jensen Huang would accompany Trump to Beijing. The stock has rallied 14% in May ahead of its May 20 earnings report. Bank of America reiterated a buy rating with a $320 target.
After hours, Cisco (CSCO) +21% — Cisco posted record quarterly revenue of $15.8 billion (+12% YoY), beating the $15.5 billion consensus, with GAAP EPS of $0.85 (+37% YoY). The stock surged to $123.36 in after-hours trading (+21.1% from its $101.87 close). The company raised its full-year revenue guidance by $1 billion, citing "very strong, broad-based demand" from hyperscalers for AI infrastructure, and announced 4,000 layoffs.
SGX Preview
The STI's last confirmed close was 4,921.90 on May 8; more recent closes were not available. DBS is near S$59.10. The Alibaba rally and Trump-Xi summit should lift China-linked Singapore names, while the chip rebound favors Venture Corp. However, 6% PPI and 5% long-end yields are a headwind for rate-sensitive equities globally.
Asia Pre-Market
Nvidia is up 0.3% in after-hours to $226.43 and Cisco is surging 15%. S&P 500 futures data for Thursday morning was not yet available at time of writing, but the after-hours tone is constructive for tech. Gold and oil data were not available for this session. The Trump-Xi summit in Beijing today is the key catalyst for Asian markets — any progress on trade, rare earths, or technology access could extend the rally in China-exposed equities.
Today's US Earnings and Economic Calendar
| Event | Time (ET) | Time (SGT) |
|---|---|---|
| April Retail Sales | 8:30 AM | 8:30 PM |
| Initial Jobless Claims | 8:30 AM | 8:30 PM |
| Company | Timing | Notes |
|---|---|---|
| Applied Materials (AMAT) | Post-mkt | Semiconductor equipment bellwether |
| Klarna (KLAR) | Post-mkt | Fintech IPO watch |
Powell's final full day as Fed Chair. Warsh takes over Saturday.
Data Spotlight: April Retail Sales — After two consecutive inflation shocks (CPI 3.8%, PPI 6%), retail sales will show whether the US consumer is buckling under energy costs. A strong print extends the "resilient consumer" narrative; a weak print raises stagflation fears. Fed's Collins warned yesterday that the Fed may need to hike rates; Kashkari said inflation is too high.
One More Thing
The market is ignoring every red flag. PPI at 6%. The 30-year yield above 5%. Rate hike odds at 36%. And yet the S&P 500 and Nasdaq both closed at records. The explanation is simple: Q1 EPS growth is tracking 25%, with 82% of companies beating estimates — earnings are too strong to sell. Nvidia reports next Wednesday, and if it delivers another blowout, the AI narrative will overpower inflation once more. But Kevin Warsh takes the chair this weekend, and his first move will define the tone for the rest of 2026. The market is betting he blinks. History suggests new Fed chairs don't.
This briefing is for informational purposes only and does not constitute investment advice.
