Fragile calm after AI whiplash
SPY•Asian shares rebounded and U.S. equity futures edged higher after a volatile week of AI-trade unwinding. Markets face more tech earnings and Tuesday’s U.S. CPI report; traders are pricing in an 80% chance of a Fed rate increase of at least 25 basis points next month.
1. Markets steady
Asian shares rebounded and U.S. equity futures edged higher after Wall Street ended Friday higher, following a chaotic week of AI-trade unwinding. The article said optimism remained fragile ahead of more tech earnings and a relatively light week for major macro events.
2. Earnings and inflation
CoreWeave, Applied Materials and Cisco Systems are due to report earnings this week. Nvidia’s launch of a board probe into reports that CEO Jensen Huang was the target of a Chinese intelligence effort could add volatility to the AI trade. Tuesday’s U.S. CPI report is also in focus after last week’s jobs report exceeded estimates; markets are pricing in an 80% chance of a Fed rate increase of at least 25 basis points next month.
3. Oil and Monday's events
Oil prices calmed after U.S. President Donald Trump said he was highly unlikely to order fresh attacks on Iran while talks to end the conflict continued to make progress. Monday’s events include German trade data, the euro zone Sentix index and French and German debt auctions.
