Warsh's Fed watches this gauge above all others. A soft reading keeps rate cuts on the table and stocks supported.
The blowout report and IBM's new AI chip prove the artificial intelligence boom is still spending real money, not just promising it.
Global stocks aren't moving as one. Japan's Nikkei led the world higher, but China-linked shares went the other way.
Stocks pushed higher across the board, and the reason is simple: the inflation and growth numbers came in friendly enough to keep the Fed in play. The S&P added 0.79%, the Nasdaq 0.93%, and the fear gauge (VIX) dropped to 17.88. Micron's blowout earnings lit a fire under chip stocks. Japan stole the show with a 4.61% jump. When inflation cools and growth holds, investors stop worrying about higher rates and start buying again.
The opportunity sits squarely in semiconductors. Micron's surge and IBM's fingernail-sized AI chip say the same thing: the money behind artificial intelligence is still flowing hard. But watch China. Hong Kong fell 1.43% while the rest of the world rallied, a reminder that not everyone is invited to this party. Gold also climbed 1.29% to over $4,000, which tells you some big players still want a hedge. That mismatch is worth respecting.
Fresh inflation and growth data came in soft enough to keep the Federal Reserve from needing to crank rates higher, and that's what investors wanted to hear. When borrowing costs stay tame, companies and shoppers spend more freely, which lifts stock prices. Micron's strong earnings on top of it confirmed that AI spending is still real money, not just hype.
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