Stocks Slip as a Hot Inflation Print Sends Yields Higher

The S&P 500 fell 0.38% on Tuesday as a hotter-than-expected October inflation report sent Treasury yields sharply higher and revived talk of a half-point December rate hike.

A partial giveback after Monday's surge

The S&P 500 fell 29.01 points, or 0.38%, to 7,520.93. The Dow Jones Industrial Average fell 157.86 points, or 0.30%, to 52,231.89. The Nasdaq Composite dropped 187.26 points, or 0.74%, to 25,065.88.

Breadth was mixed rather than bleak. Six of the 11 S&P 500 sectors finished higher, financials led with a gain of 0.52%, and technology lagged, down 1.15%.

Energy added 0.44% even as crude fell. Small caps slipped with the majors, and the Russell 2000 fell about 0.7%.

The losses trimmed only part of Monday's 2.35% S&P 500 surge, its best day since April 8. Indexes also recovered part of the midday loss before the close.

A hot print put December's size in play

October's consumer price index rose 0.4% from September, above the 0.3% forecast, TickerGrove's CPI story reported. Core prices rose 0.3% for a third straight month, above the 0.2% forecast.

The release carried no 12-month rate. The Bureau of Labor Statistics collected no October 2025 prices during last year's shutdown, so the annual comparison base is missing.

Governor Christopher Waller had set the test in London before the data. A core reading around 0.3%, he said, should put a 50 basis point hike into consideration for December.

The print landed exactly on his line. Waller backs a 25 basis point December hike as his base case, so December's live question is now 25 versus 50.

Dallas Fed President Lorie Logan has argued at least two more quarter-point hikes may be needed. Vice Chair for Supervision Michelle Bowman offered a measured counterweight.

Bowman pointed to core PCE inflation likely running near 3.3% in October. She stopped short of calling for hikes and warned that tightening's costs need weighing.

Traders priced a December hike as near-certain after the data, with a half-point move in play. The Federal Open Market Committee decides on December 8-9.

Yields jumped, and oil's cushion was not enough

The 10-year Treasury yield settled at 4.98%, up 12 basis points. The 2-year yield jumped about 18 basis points to about 4.73%.

The repricing briefly pushed the 10-year above 5% during the session. A $42 billion 10-year auction met tepid demand in the middle of the sell-off.

Oil eased for a second day as officials downplayed new strikes on Iran. December West Texas Intermediate crude settled at $86.04 a barrel, down $0.81, or 0.9%.

January Brent crude settled at $91.49 a barrel, down $1.08, or 1.2%. Both benchmarks closed at their lowest since August 31 for a second day.

Cheaper crude cushioned the inflation blow on Monday. On Tuesday it was not enough, and gold fell sharply as the dollar rose about 0.6%.

Chips split, and Nvidia fell again

Nvidia fell 5.53% to $168.80, its second straight decline. The slide followed The Information's report alleging a network moved $7.5 billion in Nvidia chips toward China.

Those are reported allegations, not findings. Reuters could not verify the report, no charges have been announced, and TickerGrove's Nvidia story lays out the account and the responses.

Microsoft fell 2.20% to $533.16. Reuters reported Microsoft briefly overtook Nvidia in market value during the session, the first such move since June 2025.

Others resisted the tide. Broadcom rose 3.91% to $331.98, and Advanced Micro Devices gained 1.30% to $515.21.

Micron Technology fell 1.10% to $725.11. The split left chips divided rather than routed, with the selling concentrated in the AI trade's biggest names.

What remains unknown

Whether Microsoft's intraday overtake of Nvidia held at the close is unsettled. No finalized source confirms the end-of-day ranking, and the closing gap had narrowed or reversed.

CoreWeave reports after Tuesday's close, a live test of AI spending. Producer prices follow on Friday, and Nvidia reports earnings on Tuesday, November 17.

Unknowns that matter: whether December brings 25 or 50 basis points, and whether core inflation at 0.3% a month becomes the pattern the Fed must chase.