Last week, the stock market struggled as the Dow Jones Industrial Average fell 1.6%, while the S&P 500 and Nasdaq dropped 0.8% and 0.7%, respectively. This decline was influenced by escalating oil prices, with West Texas Intermediate crude surpassing $100 per barrel amid U.S.-Iran tensions, and bond yields reaching their highest levels since October 2023.
The yield on the 10-year Treasury peaked above 4.95%, raising concerns that higher energy costs could sustain inflation and prompt the Federal Reserve to increase interest rates.
Inflation data released last week showed the producer price index and consumer price index both rising by 0.4% month-over-month, with core CPI increasing by 0.3%, leading to an 87% probability of a Fed rate hike at the upcoming meeting.
On a positive note, Meta Platforms made significant strides in artificial intelligence, launching its Muse personal AI agent and a competitive AI model, which may enhance its stock value, currently trading at 19 times 2027 earnings estimates.
Apple also generated excitement with its foldable iPhone Duo, priced at $1,999, and improvements to its existing models, contributing to a nearly 4% increase in its shares. Both companies are positioning themselves strongly in the AI space, which could drive future growth