I would prioritise Treasury yields, followed by the underlying core CPI components and TSMC's order outlook.
The hotter-than-expected CPI figures suggest inflationary pressures remain persistent, particularly in shelter and other essential expenses. This complicates expectations for monetary easing and could keep borrowing costs elevated.
For QQQ, rising Treasury yields are particularly concerning because higher discount rates reduce the present value of future earnings, putting pressure on richly valued technology stocks.
However, TSMC's order outlook remains important. Sustained AI infrastructure spending could support semiconductor earnings even amid tighter financial conditions.
Ultimately, strong earnings growth and reasonable valuations must work together. AI optimism alone may not sustain QQQ's rebound if inflation keeps yields elevated.
$QQQ $TSM $NVDA
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