Trump Brings Corporate Entourage to China, Amazon Pivots AI Shopping Strategy

US markets dipped Tuesday amid profit-taking in chip stocks and fresh inflation worries. The S&P 500 fell 0.2%, Nasdaq 0.7%, while semis plunged 3%—led by Intel (-7%) and Qualcomm (-12%)—after a 66% SOXX rally since April and 173% over the past year, the best 12-month stretch since the 2000 dot-com peak. Producer prices rose 6% year-over-year in April, the hottest since December 2022.

Chip Sector Pauses After Surge

Semiconductor stocks retreated sharply after an extended boom. The SOXX index, up 173% in 12 months, shed 3% Tuesday as traders locked in gains from Intel, Qualcomm, and others. Host Zaid Mani views this as normal profit-taking rather than a reversal, noting the sector's "generational run" but cautioning its similarity to dot-com highs.

Inflation Accelerates on Broader Pressures

Wholesale inflation hit 6% annually in April, topping forecasts, with core PPI (excluding food and energy) at 5.2%. CPI also landed hot at 3.8%. Higher energy costs from the Iran War are permeating the supply chain, potentially raising consumer prices. Bond markets reacted: 10-year Treasury yields neared 4.5%, the highest since last July, signaling bets on Federal Reserve rate hikes if pressures persist.