Nasdaq 100 leads declines in US indices as hot CPI and Nvidia weigh

• Monday's recovery loses about a sixth across the NASDAQ, SPX and DJIA.
• The 10-year yield moves above 5% as Fed Governor Waller raises the prospect of a half-point December increase.
• September's 1.3% rise in producer prices precedes Friday's October release.

A stronger-than-expected October Consumer Price Index (CPI), alongside discussion of a half-point Fed rate rise, has erased roughly a sixth of Monday's recovery across all three US share indices. Having surrendered about half of Monday's advance and touched an intraday low just above 27,400, the Nasdaq 100 is trading near 27,750 again. Meanwhile, levels are around 7,525 for the S&P 500 and 52,250 for the Dow Jones Industrial Average.

October's 0.4% increase in consumer prices exceeded the 0.3% forecast. Fed Governor Waller had previously suggested that an overshoot of this kind could warrant a half-point rate rise in December. No annual inflation rate accompanied the figures because the 2025 government shutdown left October 2025 without a reading. The annual measure returns on December 10, the day after the Fed's decision. With the 10-year Treasury yield once again above 5%, equity buyers are paying less for future earnings as yields rise.

Having trailed Monday's rally, Nvidia (NVDA), the world's most valuable company, is now declining and weighing on all three indices. Its retreat comes after Chief Executive Jensen Huang acknowledged an affair with a woman accused of spying for China. The NASDAQ 100 is recording the largest fall of the three, reflecting its greater weighting in semiconductor shares.

Fed speakers and inflation data shape the calendar

Tuesday brings speeches from Fed Vice Chair for Supervision Bowman and Philadelphia Fed President Paulson at 23:30 GMT, followed by Cleveland Fed President Hammack at 14:00 GMT on Thursday. Each has a vote on the December 8-9 decision. With traders regarding a rate rise as almost certain, their remarks will help inform expectations for its size.

Thursday's weekly jobless claims release is scheduled for 13:30 GMT, with 195K expected against the previous 189K. At 13:30 GMT on Friday, October producer prices will provide the next inflation reading relevant to a half-point increase. A 0.4% rise is forecast, following September's 1.3% jump.

Indices recover part of their earlier declines

Roughly a quarter of the NASDAQ 100's decline from its October 6 peak near 31,350 has now been recovered. For the S&P 500, the rebound from the November 6 low around 7,325 has covered about two-fifths of the distance to October's high just below 7,850. Since mid-September, the Dow Jones Industrial Average has remained within a 50,500-53,800 range and is currently close to its midpoint.

Daily chart of the Nasdaq 100 index