Memory bounced, bonds kept bleeding
April producer prices ran 6.0% YoY, the hottest since December 2022. Stocks rallied through it. Cisco beat and raised AI infrastructure orders to $9B. Bonds kept bleeding.
April PPI for final demand rose 1.4% month-over-month, the largest advance since March 2022. Year-over-year the index ran 6.0%, the hottest 12-month read since December 2022 and well above the 4.9% consensus. The prior month was upwardly revised to 4.3%.
Gasoline drove most of it. Wholesale gasoline rose 15.6% on the month, the headline pass-through from April's Brent peak. Tuesday's CPI ran 3.8% YoY headline. Producer prices ran 220 basis points hotter. The supply-chain is paying more than the consumer is paying, and the squeeze is moving.
The S&P closed at 742.31, up 0.56%. The Nasdaq added 0.5%. The Russell 2000 closed mostly flat. The tape priced a 6.0 producer-price print as a non-event for equities, and a confirmation for bonds.
MU closed at $803.63, up 4.83% on the day and recovering most of Tuesday's dump. NVDA at $225.83, up 2.29%. META at $616.63, up 2.26%, the hyperscaler that was down 5% on the month finally bidding back. ORCL at $189.76, up 1.57%. AMAT at $436.61, up 1.25% into Thursday's print.
SNDK closed at $1,447.23, flat after Tuesday's 6.2% drop. The dispersion within memory is showing: MU recovered, SNDK consolidated. The chips that bought back the dip versus the chips that sat.
Cisco reported Q3 FY26 revenue of $15.8 billion, up 12% year over year. Non-GAAP EPS of $1.06 beat the $1.00 consensus by 6%. Networking revenue grew 25%. Total product orders rose 35%. The company raised AI infrastructure order expectations to $9 billion for FY2026 from $5.3 billion year-to-date. Guidance up.
The print confirms what the suppliers' run was pricing: the AI infrastructure spend is real, the orders are landing, and the networking layer (Cisco) is showing the same flow that memory (Micron, Sandisk) has shown. Cisco closed the regular session at $101.87, up 2.6%. After-hours the stock spiked to roughly $119, up 17%, on the guidance raise and the AI-infrastructure restructuring that targets fewer than 4,000 layoffs against an order book that grew 35% on the quarter.
BABA reported Q4 fiscal 2026 revenue of $35.84 billion, missing consensus by $525 million. EPS missed badly. China e-commerce adjusted EBITA contracted more sharply than the 43% YoY drop seen in Q3. Cloud and AI spend accelerated through Lunar New Year promotions and the Qwen-Taobao integration but did not translate to the top line.
The print landed pre-market. BABA closed the regular session at $145.81, up 6.0% on the day. The tape rewarded the cloud and AI commentary over the e-commerce miss, with the stock running off the $130.33 intraday low after the open.
TLT closed at $84.80, down 0.22% on the day. The 10-year held its break above range. IEF at $94.32, down 0.7% over 5 days. The hot PPI confirmed Tuesday's positioning. The bond market is not letting the rate-cut path back in.
Kalshi prices a 2% probability the Fed cuts 25bp at the June 2026 meeting. 92% probability of no change at July. Polymarket prices 69% probability of no rate cuts at all in 2026. Two hot inflation prints in 48 hours have closed the cut window for the year.
Polymarket prices 100% probability Kevin Warsh is confirmed as Fed Chair by May 15. The transition is now priced as done. The Powell DOJ probe + Warsh succession + 6.0 PPI + 3.8 CPI combination resolves as the most hawkish opening for a new Fed chair in over a decade.
WTI futures closed at $101.00, down 1.15% on the day. Brent at $105.55, down 1.92%. The futures retraced as the post-rejection bid faded. Physical Mars Gulf Coast sat at $122.16 on a current tick, up 0.53%. The Mars-WTI premium widened again to $21.16. The physical grade keeps climbing while the futures complex consolidates.
Silver futures closed at $88.78, up 11.4% over 5 days. The metals run is the cleanest expression of the inflation re-acceleration the bond market is also pricing. Copper at $6.60, up 7.8%. Gold flat.
Polymarket Iran probabilities held. US-Iran peace deal by June 30 at 34%. US-Iran diplomatic meeting by June 30 at 60%. Iran airspace closed by May 31 at 38%. The market is not pricing any near-term inflection.
Retail Sales and Jobless Claims tomorrow at 8:30 AM ET. AMAT reports after close. The semiconductor equipment maker is the test for whether the supplier extension that Cisco just confirmed at the networking layer holds at the wafer-fab layer.