Closing Bell: Markets Pull Back After Hot Inflation Data and Unconventional FOMC Projections

Key Points

• Equities declined sharply as hotter‑than‑expected PPI data, rising energy prices driven by geopolitical risk, and an unconventional FOMC Summary of Economic Projections weighed on sentiment.
• Nvidia is leveraging a $17B licensing deal with Groq to deploy modular, inference‑focused chips.
• Europe—led by France—signaled restraint on security operations in the Strait of Hormuz, underscoring geopolitical uncertainty.

Markets declined sharply as geopolitical risks continued to push energy prices higher, PPI data came in well above analyst expectations, and the FOMC released an unconventional Summary of Economic Projections. The S&P 500 (SPX) fell 1.36%, the Nasdaq‑100 (NDX) dropped 1.43%, and the Russell 2000 (RUT) declined 1.64%.

Nvidia Leverages Groq Deal to Expand Inference Chips for China

Following export license approvals for its H200 chips, Nvidia (NVDA) is leveraging a $17B licensing deal with Groq to deploy inference-focused chips that can be adapted for China, sidestepping restrictions tied to its high-end training systems like Vera Rubin. This move positions Nvidia to capitalize on the rapidly expanding inference market. Unlike prior export-limited products, these systems are modular rather than downgraded, enabling flexibility within regulatory constraints.

Europe Takes Cautious Stance on Hormuz as Oil Surges near $100

Europe—led by France—is signaling a cautious, conditional stance on the Strait of Hormuz, making clear it will only support security efforts following de‑escalation and will not operate in an active warzone. While Iraq’s partial restart of Kirkuk‑to‑Ceyhan exports (approximately 250K bpd) offers a modest near‑term supply boost, the move is largely symbolic against a backdrop of severe disruptions, including significant output losses in southern Iraq and ongoing chokepoint constraints at Hormuz. Continued attacks on oil and gas infrastructure throughout the day pushed crude prices higher, with WTI closing near $100 a barrel.

Market Events for Tomorrow (ET)

8:30am

• Unemployment Claims
• Philly Fed Manufacturing Index

10:00am

• New Home Sales
• CB Leading Index
• Final Wholesale Inventories

10:30am

Natural Gas Storage

Notable Earnings for Tomorrow

• A.M: ACN, BABA, CAL, CSIQ, DRI, LE, SIG, TITN
• P.M: FDX, PL

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