What To Know: After surging more than 9% on news of President Donald Trump's 90-day pause on tariffs for non-retaliatory nations, XLI was down nearly 2% by mid-morning, reflecting broader market weakness and cautious repositioning.
The inflation data added to optimism that the front-loaded impact of tariffs may be less damaging than feared. However, that wasn't enough to extend Wednesday's euphoric rally, which saw the S&P 500 post its largest one-day percentage gain since 2008.
While the tariff pause and disinflationary surprise support a more favorable backdrop for cyclical sectors, Thursday's pullback likely reflects near-term profit taking after outsized gains and lingering uncertainty around the durability of the policy shift.
Markets are now recalibrating expectations ahead of the Federal Reserve's May meeting, with rate cut odds rising sharply post-CPI.
Read Also: Treasury Yields Rise Despite Cooling Inflation Data As ‘Bond Vigilantes’ Test Fed Resolve
© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
To add Benzinga News as your preferred source on Google, click here.
