US close: Markets mixed after sharp upside surprise in PPI

(Sharecast News) - Major indices delivered a mixed performance on Wednesday after the US producer price index registered its largest monthly increase in four years.

At the close, the Dow Jones Industrial Average was down 0.14% at 49,693.20, while the S&P 500 advanced 0.58% to 7,44.25.91 and the Nasdaq Composite saw out the session 1.20% firmer at 26,402.34.

The Dow closed 67.36 points lower on Wednesday, erasing gains recorded in the previous session despite a hotter-than-expected April consumer price index reading.

April's producer price was Wednesday's primary focus, with the Bureau of Labor Statics revealing that US PPI rose sharply last month, with the headline producer price index for final demand increasing 1.4% month‑on‑month, up from gains of 0.7% in March and 0.6% in February. April's increase also marked the largest monthly rise since March 2022.

Stripping out volatile food, energy and trade services, so-called core PPI measure rose 0.6% in April, matching the strongest monthly increase since October 2025. Over the past year, core PPI was up 4.4% - the largest annual rise since February 2023. Traders expected to see a headline increase of 0.5% month-on-month, while core PPI was pegged to rise 0.4% on the month.

Donald Trump's high-stakes meeting with Chinese president Xi Jinping also drew an amount of investor attention, with the president arriving in Beijing alongside Elon Musk and Jensen Huang. The summit follows treasury secretary Scott Bessent and Chinese vice premier He Lifeng's meeting in South Korea, where the two sides held a discussion centred on economic and trade issues.

In the corporate space, Nvidia traded higher in after Donald Trump invited CEO Jensen Huang to join him on his journey to China, while Alibaba's US-listed shares closed higher despite its announcement that core profitability had slumped in the three months ended 31 March amid heavy investments in tech and e-commerce.

Elsewhere on the macro front, mortgage applications increased by 1.7% in the week ended 8 May, according to the Mortgage Bankers Association of America, despite consistently high borrowing costs, with benchmark mortgage rates rising to their highest level in more than a month. Applications to buy a new home rose 4%, reflecting some traction for new residences, while applications to refinance a mortgage, which are typically more sensitive to short-term interest rate changes, softened by 1%.

Reporting by Iain Gilbert at Sharecast.com

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