Stocks Retreat as Oil Nears $100 and Rate-Hike Fears Return - Markets Wrap
The stock market’s record-setting rally came to a halt as persistently high oil prices raised concerns that renewed inflationary pressures could prompt the Federal Reserve to increase interest rates. Those concerns pushed the S&P 500 lower after it had reached a record high. Brent crude settled near $100 a barrel as traders assessed increased Iranian attacks on vessels in the Strait of Hormuz alongside continued steady oil flows from the Middle East. Ten-year Treasury yields recovered from their session lows following a strong $39 billion bond sale, although they remained close to their highest level since 2002. Bitcoin also declined. Investors are seeking higher returns on bonds as worries grow over inflation, rising government spending, and increasing corporate borrowing to fund the expansion of artificial intelligence. Against this backdrop, money markets are pricing in a strong possibility of another Federal Reserve rate increase by the end of 2026. Minutes from the Fed’s latest policy meeting showed that all 19 officials supported the September rate hike. Many favored the increase as a precaution against the possibility of stronger inflationary pressures. Meanwhile, SpaceX is
The stock market’s record-setting rally came to a halt as persistently high oil prices raised concerns that renewed inflationary pressures could prompt the Federal Reserve to increase interest rates. Those concerns pushed the S&P 500 lower after it had reached a record high. Brent crude settled near $100 a barrel as traders assessed increased Iranian attacks on vessels in the Strait of Hormuz alongside continued steady oil flows from the Middle East. Ten-year Treasury yields recovered from their session lows following a strong $39 billion bond sale, although they remained close to their highest level since 2002.
Bitcoin also declined. Investors are seeking higher returns on bonds as worries grow over inflation, rising government spending, and increasing corporate borrowing to fund the expansion of artificial intelligence. Against this backdrop, money markets are pricing in a strong possibility of another Federal Reserve rate increase by the end of 2026. Minutes from the Fed’s latest policy meeting showed that all 19 officials supported the September rate hike.
Many favored the increase as a precaution against the possibility of stronger inflationary pressures. Meanwhile, SpaceX is reportedly in discussions with banks and investors to raise $40 billion to purchase chips from Nvidia Corp. If completed, the financing would rank among the largest debt deals ever linked to the expansion of artificial intelligence infrastructure.