Nasdaq Index: AI Chipmakers Drive Gains as Inflation Data Hits US Stocks

AI Chipmakers Power Nasdaq Gains as Inflation Pressures Dow and S&P

U.S. equities showed a stark divergence in the mid-session of July 15, with the Nasdaq trading up 0.5% thanks to a strong rally in artificial intelligence chipmakers, while inflation data pressured the Dow and S&P 500, both down 0.5% and 0.1%, respectively.

Traders are weighing renewed momentum in the AI trade against hotter-than-expected inflation figures that are reshaping rate cut expectations and hitting traditional sectors.

Is NVIDIA’s China Deal Driving Tech’s Outperformance?

The standout catalyst came from NVIDIA, which jumped over 4.0% intraday after confirming U.S. approval to resume H20 chip sales to China. The announcement eased geopolitical trade concerns and pushed the company closer to the $4 trillion market cap milestone.

The rally sparked gains across the semiconductor space—AMD rose 5.0%, Micron gained 3.75%, and Broadcom added 2.24%. NVIDIA’s trading volume surged well above average, contributing to a broader move in tech ETFs that have drawn $20.6 billion in inflows this year.

How Is Inflation Data Dragging Broader Markets?

The June CPI print came in at 2.7% annually, accelerating from May’s 2.4%. Core CPI rose to 2.9%, while monthly readings for gas (+1.0%), apparel (+0.4%), and furnishings (+1.0%) signaled early tariff pass-through effects.

These inflationary pressures are shifting rate cut bets—Fed fund futures now price in only a 7% chance of a July cut and 60% for September. Powell’s recent comments flagged tariffs as a drag on growth and a driver of inflation, reinforcing the Fed’s cautious stance.

Which Sectors Are Feeling the Pinch?

Consumer discretionary and materials sectors are among the hardest hit, with losses ranging from 1.2% to 2.0%.

Tesla remains weak year-to-date, and retailers are under pressure from tariff-linked apparel inflation.

Materials are seeing headwinds from trade-sensitive metals, though MP Materials surged 25% on a rare-earth supply deal with Apple.

Financials are mixed post-earnings, while utilities show relative strength on AI-driven energy demand.

Outlook: Can AI Keep Tech Aloft While Inflation Pressures Mount?

This mid-session split highlights an evolving market regime where AI optimism is lifting tech independent of broader inflation risks.

With Treasury yields climbing and options volumes elevated, traders are adjusting positioning toward tech as both a growth engine and a potential inflation hedge.

If AI infrastructure trends hold and inflation keeps rate cuts at bay, expect continued divergence, with tech leading gains and traditional sectors under renewed pressure.

More Information in our Economic Calendar.