US stocks reversed Thursday's record highs on Friday, with the Dow falling 475 points and Nvidia down 3.6%, as Treasury yields hit a one-year high, China trade deals disappointed relative to expectations, and investors began the new Kevin Warsh era at the Fed with caution.
The US 10-year Treasury yield climbed to 4.597% — a one-year high — after April CPI printed at 3.8%, above forecasts, while markets now price a 38% probability of a rate hike by December as the new Fed Chair inherits a persistently hot inflation picture.
Brent crude climbed above $109 per barrel today as US-Iran tensions keep the Strait of Hormuz under threat, with oil having oscillated between $126 and $100 since hostilities began — driving US petrol above $4.50 a gallon and complicating the Federal Reserve's fight against inflation.
President Trump left Beijing after a two-day summit with Xi Jinping carrying commitments to buy 200 Boeing jets, US oil, and agricultural goods — but markets fell as the deals came in below the most bullish pre-summit expectations, with no breakthrough on tariffs or chip exports.
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