"Rising inflation concerns, hawkish monetary policy signals, and escalating geopolitical tensions weighed on risk assets. Energy markets are adding to the pressure. Oil prices surged following renewed attacks on energy infrastructure in the Middle East, intensifying concerns about inflationary pressure."
"The Federal Reserve reinforced the cautious backdrop, while Chair Jerome Powell emphasised the uncertainty created by the ongoing conflict in the Middle East. At the same time, stronger-than-expected producer price data and upward revisions to inflation expectations have further reduced the likelihood of near-term monetary easing."
"Markets are increasingly pricing a prolonged period of unchanged monetary policy, pushing Treasury yields higher and driving equities down. At the corporate level, Micron delivered strong earnings and guidance, yet its shares declined, highlighting the market's risk aversion and concerns over AI spending and valuations."
U.S. equity futures moved lower on Thursday, approaching multi-month lows following previous session declines. Multiple headwinds pressured risk assets: rising inflation concerns, hawkish monetary policy signals from the Federal Reserve, and escalating geopolitical tensions. Oil prices surged due to renewed attacks on Middle Eastern energy infrastructure, intensifying inflationary pressures. Chair Jerome Powell emphasized uncertainty from ongoing Middle East conflict. Stronger-than-expected producer price data and upward inflation revisions reduced expectations for near-term monetary easing. Markets increasingly price prolonged unchanged policy, pushing Treasury yields higher and equities lower. Despite strong Micron earnings, shares declined reflecting market risk aversion. AI sector developments offered some support, with Nvidia highlighting trillion-dollar revenue opportunities and continued aggressive infrastructure commitments.
Read at London Business News | Londonlovesbusiness.com
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