Financial Markets                      05/13 09:48

   

   Wall Street is drifting in mixed trading on Wednesday after another 
discouraging update on inflation and a recovery for technology stocks.

   The S&P 500 slipped 0.1% in early trading, still near its all-time high set 
at the start of the week. The Dow Jones Industrial Average was down 235 points, 
or 0.5%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.2% higher.

   Gains for tech stocks helped support the market, like Micron Technology's 
4.3%. They had stumbled the day before after momentum suddenly halted for 
stocks riding excitement around artificial-intelligence technology.

   Nvidia, the chip company that became one of the first faces of the AI boom, 
rose 2.4% and was the strongest force pushing upward on the S&P 500. Its CEO, 
Jensen Huang, got an invitation to join President Donald Trump on his trip to 
China, where they could discuss allowing shipments of Nvidia AI chips to the 
world's second-largest economy.

   Earlier in the day, Japan's Softbank Group Corp. said that its profit for 
the 12 months through March zoomed by nearly five-fold from the previous year 
as its AI investments paid off.

   But most stocks outside of the technology industry fell, as pressure builds 
on Wall Street.

   "Corporate earnings and AI momentum are acting as the market's primary shock 
absorbers, but the road is getting significantly rougher," said Tim Waterer, 
chief market analyst at KCM Trade.

   A report on Wednesday showed that U.S. inflation at the wholesale level was 
significantly worse last month than economists expected. That followed a report 
on Tuesday showing accelerating inflation at the U.S. consumer level.

   Prices are rising for fuel, transportation and all kinds of other things for 
various reasons, including tariffs and bad weather affecting food prices. But 
atop all of them is the jump in oil prices created by the war with Iran, which 
has slowed the global flow of crude to customers worldwide.

   On Wednesday, oil prices moved more modestly following big gains early in 
the week, and the price for a barrel of Brent crude oil slipped 0.2% to $107.55.

   But that's still well above its price of roughly $70 from before the war, 
and the resulting jump has forced traders to give up most hopes for a possible 
cut to interest rates this year by the Federal Reserve. If anything, a hike to 
rates seems like the next-best bet after no move in rates this year.

   Lower rates would give the economy a boost by making mortgages and other 
loans cheaper. But they can also worsen inflation at the same time as they push 
upward on prices for stocks and all kinds of other investments.

   The yield on the 10-year Treasury edged up to 4.47% from 4.46% late Tuesday 
and is well above its 3.97% level from before the war. .

   In stock markets abroad, indexes were mixed in Europe following a stronger 
showing in Asia.

   South Korea's Kospi led the way with a jump of 2.6%. It had sunk 2.3% the 
day before after a senior figure in the administration suggested the government 
may redistribute windfall AI profits from companies to citizens. That sapped 
momentum from AI stocks worldwide on Tuesday.

   ___

   AP Business Writers Yuri Kageyama and Matt Ott contributed to this report.

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