Stock Market Today: Dow flat, S&P 500 and Nasdaq trade lower as chip stocks dip; April CPI hits 3.8% and Treasury yields rise as oil prices gain

U.S. stocks traded lower on May 12 as investors digested a hotter April inflation report, rising Treasury yields and a pullback in chip and AI-related shares.

The Bureau of Labor Statistics said the consumer price index rose 0.6% in April and 3.8% from a year earlier, the highest annual pace in three years. That reading came after U.S. stock futures were already under pressure earlier in the session, with Reuters citing cooling momentum in chip stocks and higher oil prices.

By midday, MarketWatch said the Dow was roughly flat while the S&P 500 and Nasdaq were lower. AP described the market as falling from record highs, with AI and chip stocks among the biggest drags.

Treasury yields also moved higher after the CPI release. The Wall Street Journal reported that the 10-year yield extended its climb later in the day, adding another headwind for rate-sensitive growth stocks.

What pushed markets lower

The immediate focus was the combination of inflation and interest rates. A stronger CPI reading tends to reduce hopes for near-term Federal Reserve rate cuts, which can pressure technology shares and other high-valuation names.

Oil prices were another factor in the market mood, helping keep inflation concerns alive even as investors continued to monitor the broader earnings and macro backdrop.

Why chip stocks mattered

Chip stocks had been among the market’s strongest performers, so even a modest pause in that trade can have an outsized effect on the Nasdaq. The day’s weakness suggested traders were taking some money off the table after the recent run to record highs.

The late-day picture remained fluid while U.S. markets were still open, but the broad message was clear: hotter inflation, higher yields and a cooling chip rally were enough to pull major indexes back from their recent peaks.