Investopedia Markets News (all except PF)

• Cisco is due to release its earnings report after Wednesday's closing bell, and options pricing suggests the company's stock could move nearly 8% in either direction by the end of the week.
• The tech giant's shares have been trading at record highs as investors flock to hardware providers that comprise the "pick and shovel" play for the AI boom.

Cisco is due to release its quarterly results after Wednesday's closing bell, and traders are pricing in a big move for the stock by the end of the week.

Current options pricing suggests that traders are anticipating a move of nearly 8% in either direction by the close of trading Friday. A move of that size from Monday's closing price could boost Cisco (CSCO) shares to a record high around $107 or see them drop to $91.

Cisco shares have gained nearly 30% since the start of the year, closing at a fresh record high Monday as investors have flocked to hardware providers that make up the "pick and shovel" play for the AI boom. Cisco has more than recovered the ground it lost following last quarter's report, when worries over how high memory costs were affecting Cisco's margins pressured the stock.

Investors and analysts will be looking to Cisco's earnings for signs that the sales growth that has powered the stock past its March 2000 dot-com boom highs is still intact.

JPMorgan analysts said the biggest questions for Cisco ahead of the report are whether the company can maintain recent sales growth while raising prices to account for elevated memory costs, and how much it could lift its full-year outlook, as surging demand has boosted sales while also creating supply shortages.

Cisco is expected to report $15.55 billion in fiscal third-quarter revenue, up about 10% year-over-year, along with adjusted earnings per share of $1.03, up 7 cents from a year ago, according to estimates compiled by Visible Alpha.

Analysts are cautious on Cisco stock amid its AI rally. Seven analysts with current ratings tracked by Visible Alpha are split between four "buy" and three neutral ratings. The analysts' average price target of $88 represents downside of about 11% to the stock's Monday close.

• Inflation rose 3.8% over 12 months in April, the highest since May 2023 and in line with forecasts.
• The Iran war has sent gas prices soaring, pushing up the overall inflation rate.
• "Core" inflation outside of food and gas prices rose 2.8% over the year, slightly higher than the forecast for a 2.7% annual increase.

Inflation is making an unwelcome comeback because of the Iran war.

The cost of living as measured by the Consumer Price Index rose 3.8% over the year in April, up from a 3.3% increase in March, the Bureau of Labor Statistics said Tuesday. The increase was the highest since May 2023 and was mainly due to a surge in energy prices driven by the Iran war, which restricted oil supplies. Gasoline rose 5.4% in April alone and was 28.4% higher over 12 months, the bureau said.

The uptick of inflation puts pressure on consumer spending, with gasoline eating up more of household budgets. It also will discourage the Federal Reserve from cutting interest rates.

The jump in consumer prices put further pressure on household budgets, which have been squeezed by steeper-than-usual price hikes since the pandemic. Over the last 12 months, price hikes have outpaced pay raises, leaving hourly pay with 0.3% less buying power. That was the first drop in buying power since April 2024, and the largest since 2023, according to data from the bureau. It's also a setback for the Federal Reserve's efforts to wrestle inflation down to a 2% annual rate, which hasn't happened since 2021.

"There is a real financial squeeze underway," Heather Long, chief economist at Navy Federal Credit Union, wrote in a commentary. "For the first time in three years, inflation is eating up all wage gains. This is a setback for middle-class and lower-income households and they know it. They are having to cut back on spending and stretch every dollar.”

"Core" prices excluding food and energy rose 2.8% over 12 months, higher than the 2.7% forecasters had expected, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal. 

Economists and officials at the Federal Reserve use core prices as a better guide to inflation's trajectory, since food and energy costs can swing up and down quickly for reasons unrelated to broader inflation trends. However, core prices are affected by fuel prices, as higher transportation costs are passed on to customers.

"This data only includes the first signs of broader spillover from the oil price shock into core components, and annual inflation is set to move higher in May, which will leave the Fed on the sidelines until there are signs of oil prices heading sustainably lower," Katherine Judge, senior economist at CIBC, wrote in a commentary.

Update, May 12, 2026—This article has been updated after publication with more detail on prices, a comparison with wage gains, and commentary from economists.

News of the day for May 12, 2026

Stock futures are lower ahead of the release of a key inflation report, while oil prices rise amid a lack of progress in talks to end the Iran war; the Consumer Price Index for April is expected to show the highest inflation reading in three years as the war has sent gas prices soaring; eBay has rejected the $55.5 billion takeover offer announced by GameStop last week, calling the proposal "neither credible nor attractive;" shares of Hims & Hers Health are sinking after the telehealth firm reported a surprise net loss for the first quarter; and GitLab shares are tumbling after the software development platform announced layoffs to free up capital to invest in AI projects. Here's what you need to know today.

Stock futures are losing ground this morning as peace talks with Iran appear to be moving slower than markets may have hoped. Futures tied to the S&P 500 and the tech-heavy Nasdaq were recently down 0.4% and 0.8%, respectively, while Dow Jones Industrial Average futures slipped less than 0.1%. The major indexes each posted slight gains to open the week, with the S&P 500 and Nasdaq again closing at record highs. WTI futures, the U.S. crude oil benchmark, were up more than 3% at around $101 per barrel, after President Trump and Iranian officials each rejected the latest peace proposals over the weekend, and yesterday Trump said the ongoing ceasefire is on "life support." Gold futures were down slightly at $4,715 an ounce, while bitcoin was at $80,700, down from an overnight high of around $82,000. The yield on the 10-year Treasury note was at 4.44%, up from 4.41% at yesterday's close and nearing its highest levels of the year.

Investors will get their latest look at how the Iran war is affecting the economy with the release of Consumer Price Index data at 8:30 a.m. ET. The closely watched inflation report is expected to show that prices rose by 3.8% year-over-year in April, up from 3.3% in March and the highest level since May 2023, as soaring gas prices caused by the Iran war start to push up prices across the economy. Core inflation, which excludes more volatile goods such as food and fuel, is seen rising to 2.7% from 2.6% in March. Inflation caused by the war is affecting the economy in several ways. Gas is taking up more of Americans' budgets, forcing them to cut back on spending in other areas. The inflation surge will also likely discourage the Federal Reserve from cutting interest rates any time soon.

eBay (EBAY) has rejected last week's $55.5 billion takeover offer from GameStop (GME), saying that the video game retailer's offer is "neither credible nor attractive." In a letter Tuesday to GameStop CEO Ryan Cohen, eBay Chairman Paul Pressler wrote that the online auction platform considered several factors in rejecting the offer, including eBay's potential as a standalone business, uncertainty over how GameStop would finance the takeover, and the "leverage, operational risks, and leadership structure" a combined business would involve. GameStop shares were down 3% in recent premarket trading, while eBay shares declined 1%.

Shares of Hims & Hers Health (HIMS) are tumbling this morning after the telehealth provider posted a surprise loss for the first quarter. The company late Monday said it generated $608.1 million in revenue, about $8 million below the analyst consensus compiled by Visible Alpha, along with a net loss of 40 cents per share, when analysts had been expecting earnings of 3 cents per share. Hims & Hers lifted its full-year revenue outlook to $2.8 billion to $3.0 billion, up by $0.1 billion on both ends of the range, but cut its forecast for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to $275 million to $350 million, down $25 million at both ends. Hims shares were down 14% ahead of the opening bell.

GitLab (GTLB) shares are plunging after the software development platform announced layoffs that the company says will allow it to spend on AI projects to meet the needs of the "agentic era." CEO Bill Staples said in a letter to shareholders and employees Monday that GitLab is opening a "voluntary separation window" while it determines the scope of the layoffs. The letter did not offer an estimate of how many jobs are expected to be affected. Staples wrote that GitLab is reducing the number of countries it has teams in by about 30%, and said the company is looking to remove up to three layers of management between executives and the employees they oversee. GitLab shares were down 12% premarket. The stock entered the day down more than 30% year-to-date amid concerns that AI services will disrupt the software industry.

The memory device maker's business has been turbocharged by the AI data center boom

• Options pricing implies Micron stock could move 8.6% in either direction by the end of the week, either lifting shares to a fresh record or erasing all of Monday's gains.
• Micron shares have soared this year on booming demand for memory chips from AI data centers.

Shares of memory chip maker Micron have been on a tear this year, and some investors are betting this week will be more of the same.

Micron (MU) stock rose 6.5% on Monday, and current options pricing suggests traders expect it to move another 8.6% in either direction by the end of the week. Gains of that magnitude would put Micron shares at a fresh record high around $864, representing a weekly gain of 15.6%. That would mark the stock’s second-best week of the year so far, trailing only last week when shares rose nearly 38%. On the other hand, an 8.6% decline would leave shares around $727, less than 3% off their price heading into this week. 

Micron stock has skyrocketed this year due to surging demand for digital memory from AI data centers. Shares are up about 180% since the start of the year, and have nearly doubled in value in the past month alone. 

Micron and other memory firms, including SanDisk (SNDK) and Western Digital (WDC), have become the vanguard of the AI rally this year. Like the AI bellwethers that preceded them, their share prices are increasingly a reflection of how investors feel about the nascent technology.

Micron is one of a handful of memory device makers that have seen the AI data center boom turbocharge their businesses. In Micron’s fiscal second quarter, revenue nearly tripled, gross margins doubled, and net income increased 770%. The company’s third-quarter revenue and earnings forecast blew Wall Street’s estimates out of the water. Investors will learn how the quarter actually shook out when Micron reports earnings next month. 

Wall Street analysts are bullish on Micron stock. Ten of the 11 analysts tracked by Visible Alpha with current assessments of the stock rate it a “Buy,” while the sole holdout has assigned it a neutral rating. 

Though, the stock’s rise has been so meteoric that most analysts expect it to cool off eventually. The average analyst’s target price of $539 represents about 32% downside from Monday’s closing price. Only one analyst, with a price target of $1,000, expects Micron stock to rise over the next year.

Episode 294 of the Investopedia Express podcast with Caleb Silver (May 11, 2026)

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The relentless bull market has several of the biggest private companies in the world set to go public in what will be the largest IPOs in history. Sonali Basak, Chief Investment Strategist for iCapital, sets the stage for this new generation of trillion-dollar companies, and makes the case for more investment in private markets today. Plus, money market funds just had their biggest inflows in six years just as the stock market made new record highs. Is that a warning sign, or just more dry powder ready to join the risk-on rally?

Take A Number: A Striking Figure In Economics News Today

• Only 6% of businesses expanded their workforces in the last three months, a survey of business economists found.
• The poll showed businesses facing rising prices and declining profits due to the impact of the Iran war.
• Business leaders are feeling some of the same pessimism about the conflict that has pushed consumer sentiment to an all-time low.

The Iran war is dragging down hiring, pushing up costs, and raising the chance of a recession, according to business leaders.

A survey published Monday by the National Association of Business Economists raised red flags about a worsening business climate on several fronts. Survey respondents pointed to conflict in the Middle East, which is pushing up fuel prices and stoking uncertainty. One standout figure: only 6% of companies observed higher employment at their firms in the quarter, the fewest since the third quarter of 2020, when COVID-19 was still raging.

While the economy has stayed resilient despite the Iran War's energy shock, business leaders see growing risks and have curtailed hiring and investment.

"The conflict in the Middle East is weighing on businesses across sectors, driving up costs, compressing profits, and cooling plans for investment and hiring, and the latest survey results reflect that shift clearly," the association said in a press release accompanying the survey.

The National Association of Business Economists polled 50 professional economists who work for private companies and trade associations.

The survey also found that more than two-thirds of businesses had rising materials costs over the past quarter, the most since 2022; and 50% saw more than a one-in-four chance of a recession in the next year, edging up from 44% in the most recent survey in January. The businesses saying they had been negatively impacted by the war outnumbered those who hadn't, 48%-44%, and another 8% said it had a positive effect.

The deteriorating mood of business economists mirrors a sharp decline in public opinion about the health of the economy and household finances since the war began.

• Most S&P 500 companies have reported first-quarter results by the end of last week, with 84% of them beating Wall Street analyst estimates. Tech is doing even better.
• The S&P's biggest companies are outpacing the overall index since the end of March, up more than 25% compared to the benchmark's 16% gain.

This earnings season has dealt a blow to AI doubters—and showered rewards on those who kept the faith.

Nearly all of the S&P 500's members have reported earnings for the latest quarter, and 84% of those that have, beat analysts' earnings expectations—higher than the one-, five- and 10-year averages, according to DataTrek's Nicholas Colas and Jessica Rabe. Underneath the hood, tech did a lot of the lifting, with the sector logging beats at a 94% clip, they said. That goes a lot of the way toward explaining why stocks are rising these days; the benchmark S&P 500 is up 16% since the end of March, while the so-called Magnificent Seven, the biggest stocks in the S&P, have climbed more than 25%.

"Overall this earnings season has been a 'wake up call' for the tech skeptics on the sideline of the AI Revolution," Wedbush's Dan Ives wrote Monday. He sees the numbers as a sign of more gains on the way, writing that that "AI adoption is underway"—demand for chips, other hardware, as well as software remains aloft, in other words—signaling a "bright green light to own the the core tech winners into the year-end."

Though various market experts have expressed concern over the S&P 500's climb lately, AI skeptics sitting out tech stocks over the past few weeks have missed out on substantial gains.

That is the question of the moment for investors: Will tech stocks and the overall market keep going even after their torrid climb?

Morgan Stanley appears to think the market's run is supported by the strong showing in earnings results. "Fundamental strength continues in US earnings," Morgan Stanley's equity strategy team led by Michael Wilson wrote in a report Monday. Mag 7 earnings are now expected to grow 34% this year, while the rest of the 493 S&P constituents projected to see EPS growth of 13%, they said—perhaps an indication that the benchmark index could keep running.

Indeed, even the market experts that say these are "crazy times" and that the market is "melting up" are buying AI stocks or hiking price targets that top Street estimates. Being a contrarian has been a losing proposition so far this year.

"Geopolitical concerns are valid and so is rising inflation, but the market doesn't care and is focused on earnings growth. Fighting that narrative has been frustrating and not profitable," Jay Woods, Freedom Capital Markets' chief market strategist, said in an emailed statement. He is watching for a resolution around the Strait of Hormuz, which he said could be a "sell the news" event, as well as Tuesday's inflation report, which he thinks could fuel a volatile trading day given the market's outsize reaction to Friday's jobs data. "Perhaps this week," he wrote, "that story changes."

And the earnings season, especially for Big Tech, isn't over yet: Chip giant Nvidia (NVDA), the world's most valuable company, is due to turn in its results next week.

• Recent options pricing suggests traders see Intel shares swinging up to 8% by the end of this week, following a rally that's sent the stock to new highs.
• The chipmaker's stock has been boosted lately by better-than-expected earnings, along with reports it could be on the verge of securing a major new customer.

Traders are betting on some big moves for Intel's stock that could extend its record-setting rally.

The shares—which added almost 4% Monday to set a fresh closing record above $129—are seen swinging up to about 8.5% in either direction by the end of the week, based on recent options pricing. A move of that size could lift the shares to a new high around $140, after what's already been a torrid run for the stock.

Shares of Intel (INTC) have nearly doubled in value over the past month alone, and are up close to 500% over the past 12 months amid growing optimism about the chipmaker's turnaround after better-than-expected results and a series of high-profile deals.

Some investors may be wondering whether Intel's stock could still have room to rise after its recent rally, or be due for a pullback.

Intel shares have gotten a boost in recent weeks after the company said it's seen booming AI demand drive up sales, and in the wake of reports that its foundry business could be approaching a deal to sell chips to Apple (AAPL).

Broadly improving sentiment around AI-related stocks such as Intel, along with peers in the semiconductor industry such as Advanced Micro Devices (AMD), have also helped drive the Nasdaq and S&P 500 to new highs.

However, Wall Street analysts remain divided on Intel's stock amid some worries it's pulled ahead of the company's fundamentals. Among the seven analysts with current ratings tracked by Visible Alpha, just three have called it a "buy" compared to three neutral ratings, and one recommendation to sell. Their average price target just under $85 is more than 30% below Monday's close.

• The Consumer Price Index is expected to have jumped 3.8% over the last 12 months in April, amplifying concerns that inflation is threatening the economy and hurting household budgets.
• Rising fuel costs are the main source of inflation, since the Iran war has restricted the flow of crude oil to global markets.
• Rising inflation could discourage officials at the Federal Reserve from cutting the central bank's benchmark interest rate since inflation is running well over the Fed's 2% target.

Inflation likely surged last month, and not just from the Iran war's spike in gasoline prices.

A report on the Consumer Price Index from the Bureau of Labor Statistics on Tuesday is likely to show prices rose 3.8% over the year in April. That would be up from a 3.3% annual increase in March if the forecasts from economists surveyed by Dow Jones Newswires and The Wall Street Journal prove true.

That would be the highest inflation rate since May 2023. The major culprit is expected to be gasoline, which has risen more than $1.50 a gallon since the war began, according to AAA. However, it's not the only rising price.

"The ongoing conflict in the Middle East has kept energy prices elevated, which will start to generate more obvious spillovers into other areas of inflation," economists at Wells Fargo Securities, led by Chief Economist Tom Porcelli, wrote in a commentary.

Rising inflation due to the Iran war is the latest stumbling block for the economy: It's preventing the Federal Reserve from boosting the economy by cutting interest rates, and could hurt consumer spending as gasoline eats up a greater share of household budgets.

The ongoing closure of the Strait of Hormuz, the vital waterway through which 20% of the world's oil supply usually flows, has pushed up prices for crude oil, fertilizer, and other materials, threatening to reignite inflation that was already under pressure from tariffs.

The surge in diesel fuel prices has pushed up transportation costs for food and other products, which will likely be passed on to customers. The price increases have stressed household budgets and raised concerns among economists that consumers will be forced to cut back on other spending to keep fueling up their vehicles.

The report is also expected to show core inflation, which excludes the volatile prices for food and energy, rose 2.7% over the year. That would be up from 2.6% in March, reaching a fresh high since September.

Economists generally view core prices as a better guide to inflation's trajectory than the broader index, because food and gas prices can swing up and down for reasons unrelated to inflation, such as weather.

Economists expect core inflation to accelerate in April, partly due to actual price pressures and partly because of a statistical quirk.

Last year's government shutdown forced the bureau to skip collecting data in October, which affected its measurement of housing costs. Forecasters expect the agencies to catch up on the skipped surveys this week, boosting rental costs in the index and slightly lifting core and overall inflation.

Rising prices are stressing household budgets and have helped plunge consumer sentiment to its lowest on record.

In an April Gallup poll, 31% of U.S. adults said "affordability" was their biggest financial challenge, up from 29% in April 2025, though still below the all-time high of 41% in April 2024.

Prices also a headache for officials at the Federal Reserve, who have taken cuts to borrowing costs off the table for the time being as inflation fears have eclipsed concerns about the faltering job market. Tuesday's report is expected to reinforce those concerns, as it will show inflation running well above the Fed's 2% annual target.

• Soaring memory and chip stocks have propelled unusually large gains for tech-focused ETFs this year.
• The chip rally has caused many ETFs to become concentrated around the AI data center theme, eroding what can be a core benefit of ETFs: diversification.

Some exchange-traded funds offer the safety of diversification at the expense of eye-popping returns. This year, returns are the story, especially at funds that hold big slugs of red-hot chip shares.

A handful of tech ETFs—especially those holding semiconductor stocks—are outperforming the market in dramatic fashion in 2026. The Roundhill Memory ETF (DRAM), which launched in April, leads the pack with a 99% return as of Monday. As its name suggests, the fund is tied to one of Wall Street’s favorite themes of late: the memory shortage caused by booming AI data center demand. DRAM offers exposure to “a precise basket of global memory chip companies” benefiting from “the multi-decade buildout of AI infrastructure,” according to Roundhill. (The S&P 500, for comparison, is up less than 10% this year.)

As tech ETFs become more concentrated in volatile memory and semiconductor stocks, the funds grow more vulnerable to sharp swings in the share prices of their largest holdings. Greater concentration in high-flying stocks means a bigger lift on up days, but it also means a steeper drop on down days.

The vast majority of semiconductor ETFs are also trouncing the market. The Invesco Semiconductors ETF (PSI) has risen about 75% this year. The fund tracks a proprietary index of 30 semiconductor stocks, making it more diverse than some of its peers, though huge gains in a single stock have recently increased the fund’s concentration risk; shares of MaxLinear (MXL), a chip designer with a fast-growing data center business, is up more than 300% in the past month. As a result, the $8 billion company accounts for 10% of PSI, more than twice the weight of Nvidia (NVDA), a $5 trillion juggernaut. (Their weights may be adjusted during the index’s quarterly rebalancing at the end of the month.)

DRAM’s concentration—what Roundhill calls its “precise basket”—is one of the keys to its success. The ETF is composed of only nine stocks, and its top three holdings—Micron (MU), SK Hynix, and Samsung—account for nearly three-quarters of the fund. Those holdings have performed exceptionally well this year. Micron is up more than 175%, while SK Hynix and Samsung have risen about 190% and 140%, respectively. Smaller components have performed even better. Shares of SanDisk (SNDK), about 6% of the fund, are up more than 400% in 2026. 

“Investors are waking up to the fact that the biggest bottleneck in the AI buildout is actually memory chips,” Roundhill CEO Dave Mazza said on CNBC Tuesday. “There’s actually an incredible amount of supply-and-demand imbalance with memory, which is one of the reasons the stocks have been performing so well.”

Other chip funds have been boosted by Intel (INTC), the S&P 500’s best-performing stock over the past month. Shares of the chipmaker last month closed at their first record high since 2000 after the company blew past earnings expectations due to “unprecedented demand” from the AI boom. Intel is the top holding in the First Trust Nasdaq Semiconductor Index (FTXL), up 70% this year, and the Xtrackers Semiconductor Select Equity ETF (CHPS), up about 65%. 

Chip stocks are increasingly in the drivers seat of tech funds that ostensibly target broader themes. Micron, SK Hynix, and Intel account for more than a quarter of the Invesco AI and Next Gen Software ETF (IGPT), an index of “companies with significant exposure to technologies or products that contribute to future software development.”

The fund has long held semiconductor stocks, but their weight in the index ballooned over the past year as chip stocks rallied and software stocks slumped amid mounting uncertainty about AI’s impact on the industry. Between early 2025 and 2026, software’s share of the index declined from 21% to 11%, while semiconductors’ share increased from 31.5% to 45%.

This article was first published on May 11, 2026. It was updated to add comment from Mazza and to reflect the latest market data.