Investors Overlook Brewing Inflationary Forces and Pour Capital In Ai Trade

Barry Adams
14 May, 2026
New York City

Stocks in New York traded higher, powered by another upswing in the semiconductor stocks. 

The S&P 500 index increased 0.2%, and the tech-heavy Nasdaq Composite edged up 0.1%. 

The semiconductor- and AI-related stocks continued to dominate market sentiment as investors piled fresh capital into the narrow segment of the market. 

Intel, Nvidia, AMD, Corning, Broadcom, Micron Technology, Wolfspeed, and Qualcomm extended their recent gains amid continued enthusiasm about the demand from AI-driven datacenters. 

Despite the market rally over the last seven weeks, hotter-than-expected producer price inflation kept market enthusiasm in check. 

The producer price index soared in April, driven by a surge in wholesale prices of energy products, food, and transportation and warehousing services. 

The measure of wholesale prices shot up 6.0% in April, the fastest annual increase since December 2022, when prices rose 6.4%. 

The self-inflicted energy price shock has reignited inflationary forces in the U.S., as the supply disruptions in the Strait of Hormuz ripple through energy markets around the world. 

 

Retail and Food Services Sales Jumped In April

The preliminary estimate of retail and food services sales in April showed a sharp jump, according to the latest released by the U.S. Census Bureau. 

Retail and food services sales, not adjusted for inflation but adjusted for seasonal factors and calendar shift, increased 4.9% to $757.2 billion. 

On a monthly basis, sales rose 0.5%, driven by gasoline station sales increases of 2.8% and sales at non-stores increased by 1.1% and food and beverages by 0.8%.

 

U.S. Movers 

Cisco Systems jumped 15.6% to $117.80 after the networking gear maker's fiscal third quarter outlook surpassed expectations. 

Revenue in the fiscal quarter ending in April rose 12% to $15.8 billion from $14.1 billion, net income advanced 35% to $3.4 billion from $2.1 billion, and diluted earnings per share increased 37% to 85 cents from 62 cents a year ago. 

The company estimated fiscal fourth quarter revenue to range between $16.7 billion and $16.9 billion and earnings per share between 80 cents and 85 cents; and full-year revenue to range between $62.8 billion and $63.0 billion and earnings per share between $3.16 and $3.21. 

Doximity Inc. dropped 21% to $18.44 after the digital healthcare platform operator reported quarterly results, and the company's outlook fell short of market expectations. 

Revenue in the fiscal fourth quarter ending in March rose 5% to $145.4 million from $138.2 million, net income dropped to $19.1 million from $62.5 million, and diluted earnings per share fell to 10 cents from 31 cents a year ago. 

The company guided current quarter revenue to range between $151 million and $152 million and adjusted operating income between $68.5 million and $69.5 million. 

For the fiscal year 2027, the company estimated revenue between $664 million and $676 million and adjusted operating income between $323 million and $335 million.