Finance

The technology sector, which recently propelled the market to new heights, experienced a notable reversal as semiconductor firms like Micron and Qualcomm saw significant declines. This cooling off follows a period of intense growth driven by artificial intelligence spending, leading some analysts to suggest the sector is entering a consolidation phase.

Ongoing conflict in the Middle East has driven West Texas Intermediate crude futures above $100 per barrel, contributing heavily to recent inflation spikes. The rising cost of fuel accounted for approximately 40% of the April CPI increase, leading to concerns that persistent high energy prices may force the Federal Reserve to maintain elevated interest rates for longer than previously anticipated.

Following the release of resilient labor data and high inflation readings, major brokerages have significantly scaled back their expectations for interest rate cuts this year. Markets are now pricing in a high probability that the Fed will hold the benchmark rate steady in its current 3.5% to 3.75% range through the end of 2026, with some traders even speculating on a potential year-end hike.