Month: October 2026

Doubts over the payoff from massive AI spending triggered a sharp tech selloff, with Meta’s negative free cash flow weighing on sentiment. Oil surged on renewed Middle East tensions, while French borrowing costs climbed above 5%. Attention now turns to the Fed, US GDP and inflation data, and earnings from Microsoft, Alphabet and Amazon.

Hot inflation and surging oil have revived expectations of a Fed rate hike, pushing the 10-year Treasury yield back above 5%. The AI trade hit a debt-funding wobble, with leveraged names such as CoreWeave selling off sharply, while banks and defensive sectors held up better. We continue to favor quality balance sheets, diversified financials, high-quality income and measured energy exposure over debt-heavy growth.

Bond yields climbed to multi-decade highs as oil stayed above $100 amid Gulf attacks and hurricane-related supply risks, stoking inflation concerns. US stocks ended higher for the week, but a wobble in AI-linked shares exposed narrow market leadership. Meanwhile, renewed Saudi-Houthi fighting raised fresh risks to regional security and oil flows.

Markets turned a soft September jobs print into relief, as just 29,000 jobs added and a 4.2% unemployment rate slashed October Fed hike odds to 14%. Yet Treasury yields held near 24‑year highs and oil hovered around $100, keeping inflation and December‑hike risks firmly in focus for investors.