The S&P 500 Index is down 0.83% today, while the Dow Jones Industrial Average has declined by 0.53%, and the Nasdaq 100 is down 1.39%, reaching a six-week low. The downturn is primarily driven by weaknesses among chipmakers and AI-infrastructure stocks following a proposal from AI leaders, including OpenAI’s Sam Altman and Elon Musk, to slow advancements in the technology, which raises concerns over reduced capital spending.
Crude oil prices surged more than 3% due to the closure of Saudi Arabia’s East-West pipeline, which carries 7 million barrels per day (bpd), following attacks from Houthi rebels. The yield on the 10-year UK gilt rose to 5.43%, a 19-year high, and inflation expectations are climbing, impacting global markets. The Federal Reserve’s upcoming meeting is anticipated to favor a 25 basis point rate hike, which the market is pricing at a 91% chance.
In individual stocks, the iShares Semiconductor ETF is down over 5% at a one-week low, while software and cybersecurity stocks are gaining, with CrowdStrike leading gains in the S&P 500 with a 12% jump. Overall, market conditions reflect a cautious outlook as inflation fears and interest rate hikes loom large.
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