Market Overview for May 13: Nasdaq gives back April gains, oil prices surpass $100, Bitcoin falls below 80k

Author: Deep Tide TechFlow

On Tuesday, Wall Street was hit by a hotter-than-expected CPI data at the open.

April CPI rose 3.8% year-over-year, hitting a new high since May 2023, while the market had expected 3.7%. Core CPI increased 2.8% YoY, also above the expected 2.7%. This number alone is already quite ugly, but what’s even more concerning is the logic behind it: the main driver of accelerating inflation is energy, and the source of rising energy prices is Iran.

The Strait of Hormuz remains nearly shut down, with Saudi Aramco CEO Nasser warning that the market is losing about 100 million barrels of oil supply weekly; if the deadlock continues, normalization could be delayed until next year. The day before CPI was released, Trump already characterized Iran’s ceasefire agreement as “being kept alive by a ventilator,” and called Tehran’s counterproposal “garbage.” CNBC further revealed during midday that Trump is taking a more serious look at resuming military action against Iran.

Higher inflation, higher interest rates, and the shadow of war drawing closer—these three factors together should, according to textbooks, trigger a sell-off in stocks, bonds, and commodities. But today’s market did not follow the textbook.

U.S. Stocks: Dow Turns Green, Nasdaq Erases April Gains

The Dow closed up 56.09 points at 49,760.56, a 0.11% gain. This was a very “barely” green close, having dipped as much as 255 points during the session, only turning positive before the close thanks to a late rally.

However, the S&P 500 fell 0.16% to 7,400.96, and the Nasdaq dropped 0.71% to 26,088.20. The Russell 2000 initially fell over 2% intraday but narrowed its losses by the close.

This was a market supported by defensive stocks. Walmart rose 2.15%, UnitedHealth gained 2.06%, JPMorgan Chase up 1.68%, Merck up 1.48%—the classic “inflation is here, buy essentials and healthcare” combo.

Meanwhile, the most glamorous stories on Wall Street over the past two months—AI and semiconductors—were sold off.

Micron fell 3.6%, giving back a small part of last week’s 37% and last month’s 53% gains. AMD declined 2%, Qualcomm plunged 11%, a particularly sharp drop considering it had risen 39% in April. SanDisk dropped 4%, Intel down 4%, and TSMC nearly 2%. Among the 11 sectors in the S&P 500, tech led the decline with 1.5%, consumer discretionary fell 0.93%, industrials 0.4%, and materials 0.2%.

Looking further out: today, Nasdaq and Russell narrowed their intraday losses from over 2% to less than 1%, a V-shaped reversal indicating that both buyers and sellers are still active. Chip stocks don’t want to be sold off completely, but every time they rally to this level, some investors start trimming their positions.

The VIX rose 6.9% to 18.38, just enough to keep traders awake but not enough to cause alarm. The 10-year U.S. Treasury yield continued to rise with oil prices, which is the real trouble for tech stocks: the discount rate has returned to a level they dislike the most.

David Einhorn told CNBC near the Sohn conference that he admits to missing the V-shaped rebound over the past six weeks but still believes the stock market is “very, very expensive.” This sounds like hindsight, but remember, the last time the S&P 500 was at a “high in the index but 50% of its components fell below the 50-day moving average” was from December 1998 to March 2000.

Oil Prices: Break Above $100, “Ceasefire Maintained by Ventilator”

On Tuesday, WTI crude June futures surged 4.19% to $102.18 per barrel, Brent rose 3.4% to $107.77 per barrel.

This is a candlestick pattern that reflects inflation’s face.

The April ceasefire agreement has been leaking from day one. Ten weeks later, the Strait of Hormuz—through which 20% of global oil passes—remains functionally closed. Trump’s words like “garbage” and “ventilator” in diplomatic language are now approaching a warlike tone, and the Pentagon is reportedly reassessing plans to “force open Hormuz” and “escort commercial ships.”

The last time oil prices topped $100 was in early 2026, during the outbreak of war. Today, reaching that level again, the market faces an even more uncomfortable reality: this war is not a short-term event; it’s becoming a new normal price baseline.

The direct beneficiaries are energy stocks. The XLE energy ETF rose 2.6%, the best-performing sector of the day. But the cost is already reflected in the CPI report: April inflation jumped 0.4 percentage points, with energy contributing a large chunk.

Barclays has raised its oil price target to $100, and the Saudi Aramco CEO’s warning of “losing 100 million barrels weekly” still echoes in the market. If that’s true, for oil prices to fall back below $80 this year, it would require a ceasefire, not a technical correction.

Gold and Silver: Safe-Haven Assets Not Immune

If there’s any data that can shatter the simple logic of “inflation is bullish for gold,” it’s Tuesday’s performance of gold and silver.

Gold spot fell 0.82% to $4,704.25 per ounce, briefly dropping below $4,690 during the session. Silver declined to $84.53 per ounce, down about 1.09%, after surging over 6% on Monday.

Why did gold and silver fall?

First, the dollar rebounded. CPI above expectations quickly removed the probability of rate cuts this year from traders’ models. CME interest rate futures now price in over a 70% chance of rate hikes before April 2027, and rate cuts this year are “basically ruled out.” When the dollar strengthens, gold and silver weaken.

Second, real interest rates are rising. The 10-year Treasury yield is climbing along with oil prices and inflation expectations. Gold has no yield, so it always has an inverse relationship with real interest rates.

Third, silver’s industrial properties backfire. Silver is never purely a safe-haven asset; it’s also an industrial metal. Monday’s 6% surge was driven by “AI data center copper demand spillover + safe-haven logic,” but Tuesday’s decline was a slap back from “recession worries.”

But the other side of the story is: gold YTD still up about 43%, and over the past year, it gained $1,463 per ounce. This correction looks more like a healthy profit-taking than a trend reversal.

Cryptocurrency: Bitcoin Falls Below 80k

According to CoinGecko, Bitcoin dipped to around $80,389 on Tuesday, ultimately hovering near $80k. Just on Monday, BTC was trading at $82,164, the strongest opening price since January 31 this year. From “strongest open” to falling below $80k, it took just one trading day.

Ethereum fared worse. Opening at $2,339, it briefly dropped 3% to $2,259. Wu Blockchain cited internal Fundstrat forecasts that ETH could fall to $1,800–$2,000 in the first half of this year, and Tuesday’s price is only about 10% above that range.

The total global crypto market cap is about $2.77 trillion, down roughly 1.4% in a single day. Bitcoin’s dominance remains at 58.3%, and in a declining market, “BTC dominance” usually means altcoins are falling even harder.

The sell-off was driven by several overlapping factors:

First, the macro risk appetite switch was turned off. CPI above 3.8%, no rate cuts expected, oil above $100—all adverse for risk assets piled up on the same day. Crypto is always at the far end of the risk appetite curve.

Second, a chain reaction of leveraged liquidations. Market analysis shows that after Bitcoin broke below the critical 85,000 USD 100-week moving average, it triggered systemic liquidations. During periods of low liquidity, forced liquidations of leveraged positions reinforce each other, with each spike triggering the next.

Third, the ETF “faucet” problem. Institutional inflows into crypto via ETFs have slowed significantly this year. Since the start of 2024, U.S. spot Bitcoin ETF net outflows have reached about $4.5 billion, the worst start to a year since their launch in January 2024. This indicates marginal buying is weakening, and there are fewer buyers to absorb declines.

The only “positive” is at the political level: the Senate on Tuesday approved Kevin Warsh’s nomination to the Federal Reserve Board by a 51-45 vote. It’s widely believed Warsh is more friendly to crypto. But this doesn’t help today’s market, which is more worried about how much oil prices will rise in the next few days than about May 15th Powell’s departure.

Today’s Summary: The Return of Stagflation

On May 12, the market was hit by three data points simultaneously:

U.S. stocks: Dow rose 0.11 supported by defensive stocks, Nasdaq fell 0.71%, AI and chip stocks took their first profit-taking wave.

Oil: WTI surged 4.19% to over $102, “ceasefire maintained by ventilator.”

Gold: Unusually fell 0.82% to $4,704, as the dollar and real interest rates rebounded, safe-haven assets also couldn’t escape.

Crypto: Bitcoin fell below $80k to $80,389, Ethereum dropped to $2,259.

The market’s only concern now: has stagflation truly returned?

If in the next two weeks, there are genuine signs of de-escalation in Iran—such as ceasefire negotiations restarting or Hormuz reopening—oil prices will lead the decline, CPI expectations will ease, risk assets will rebound collectively, and crypto could be the most resilient segment.

If Trump orders a resumption of military strikes, pushing oil to $120 won’t be just a scenario; the S&P 500 could take another hit, and $70k Bitcoin might become the next support level tested.

But at least today, one signal is very clear: when safe-haven and risk assets fall together, the market is re-pricing a more uncomfortable reality—namely, that the dollar’s purchasing power is being eroded by inflation, and the Fed has no bullets left.