The Daily Wrap – May 12, 2026

Stubbornly high inflation, driven by soaring energy costs from the war with Iran, rattled the markets as the April Consumer Price Index surged to a three-year high of 3.8%, pushing any hope of Federal Reserve rate cuts off the table. Amid the market downturn, Tesla shares also slipped as CEO Elon Musk prepares to join President Trump's trade delegation to China, where he will seek crucial approval for the company's Full Self-Driving software to combat falling sales. The day's corporate news was also marked by significant deal-making drama, including e-commerce giant eBay formally rejecting a $56 billion takeover bid from GameStop and an activist push by Nelson Peltz to take Wendy's private.

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From Pinextra Pro in Tampa, it's Tuesday, May 12th, and I'm Rachel Anderson with the Daily Rap. The April consumer price index came in hotter than expected today. Consumer prices surged 3.8% from a year ago, the highest level in three years, as the war with Iran continues to drive up energy costs. The headline CPI rose 0.6% in April from the month before, with energy prices accounting for over 40% of that increase. Gasoline alone is up 28% from last year. After you strip out volatile food and energy, the so-called core inflation also picked up, rising to 2.8%. That's a sign that price pressures are broad-based, with shelter and apparel costs also climbing. This puts the Federal Reserve in a very difficult position. Any talk of interest rate cuts, which investors were banking on at the start of the year, is now off the table. The debate has shifted to whether the Fed might need to signal a rate hike is coming, a difficult inheritance for incoming chair Kevin Walsh. U.S. crude oil is back over $100 a barrel, with Brent crude trading above $107. This comes after the president rejected the Iranian counterproposal for peace and saying the ceasefire with Tehran is on life support. In response to rising prices at the pump, which now average $4.50 a gallon nationwide, the president has said he supports a temporary suspension of the 18.4 cent federal gasoline tax to provide some relief to consumers. E-commerce giant eBay has formally rejected an unsolicited $56 billion takeover bid from the much smaller GameStop. In a letter to GameStop CEO Ryan Cohen, eBay's board called the proposal neither credible nor attractive, citing major doubts about the financing for the deal. Cohen had argued he could create a stronger rival to Amazon, but investors were skeptical, and eBay's stock has been trading far below the $125 per share offer price. Tesla shares are slipping after a strong five-day rally. The pullback comes as CEO Elon Musk prepares to join the president's trade delegation to China this week. The main focus for Musk is winning approval for Tesla's full self-driving software, a key feature needed to compete against Chinese rivals like BYD and Xiaomi. Nelson Peltz's try and fund management is reportedly seeking backing for a bid to take Wendy's private. Shares of the burger chain soared 16% on the news. Pilts already owns a significant stake in the company, which has seen its stock fall over 70% from its 2021 high. It's a tough day for him's and hers health. The telehealth stock sank 15% after reporting a quarterly loss and missing sales expectations. The company cited restructuring charges as it pivots away from compounded weight loss drugs and toward partnerships for name brand medications, like those from Novar Nordisk. After a blistering rally fueled by the AI boom, semiconductor stocks are taking a breather today. Intel shares, which had more than doubled in the past month, were down over 8%. Qualcomm and AMD also pulled back from record highs as investors appear to be taking some profits off the table. Gold prices slipped on the prospect of higher interest rates, but silver has been a standout performer, surging to its highest price since March on hopes that the president's upcoming trip to China could improve trade and boost industrial demand for the metal. U.S. Treasury yields moved up after a higher than expected CPI report. The 10-year is at 4.45%, the two-year yield is at 3.99%, and the 30-year bond yield is at 5.02%. And now let's check the scoreboard. Wall Street is seeing red today due to the combination of high inflation and losses from some big tech names. Midday, the SP was down around 0.8%, the Dow was down almost 0.4%, and the Nasdaq was down over 1.5%. That's all for your daily rap today. I'm Rachel Anderson from Phoenixtra Pro turning data into stories.