Wholesale Inflation Slowdown Triggers Treasury Yield Drop and Growth Stock Rally
ZH
Zora Hastings
Fed interest rate decision · Apr 14, 2026
Source: DojiDoji Data Terminal
Shares of Apple Inc., Microsoft Corp., and NVIDIA Corp. climbed more than 2% as the discount rate used to value their future earnings dropped. The shift followed a nearly 12 basis point decline in the 10-year Treasury yield, which settled near 4.15%.
This movement occurred after the Bureau of Labor Statistics reported that the March Producer Price Index (PPI) rose 0.5% month-over-month. The figure came in below the consensus forecast of 0.8%.
While the 0.5% increase remains elevated, the moderation in wholesale inflation provided a catalyst for growth stocks and small-cap companies in the Russell 2000 Index, which are more sensitive to borrowing costs. Conversely, major financial institutions including JPMorgan Chase & Co. and Bank of America Corp. saw share prices trade flat to slightly down. The retreat in long-term yields while short-term rates remain anchored by the Federal Reserve's current policy creates a flattening yield curve, which compresses net interest margins for traditional banks.
Small-cap companies in the Russell 2000 Index saw share price increases due to lower borrowing costs.