Finance

Energy costs spiked significantly as Brent crude reached over $109 per barrel, driven by escalating geopolitical tensions in the Middle East and concerns over the closure of the Strait of Hormuz. These rising costs have rattled market participants, fueling fears that persistent inflation could hinder the Federal Reserve's ability to lower interest rates. Market analysts noted that historical precedents show sharp oil price spikes often precede broader economic recessions.

The yield on the 10-year Treasury note jumped above 4.6% on Friday, marking its highest level in a year as bond investors responded to hot inflation data. Similarly, the 30-year yield surged past 5.1%, reaching levels not seen since 2007. This spike in borrowing costs reflects growing market bets that interest rates will remain higher for longer, or potentially even face additional hikes later in 2026.

Artificial intelligence and semiconductor stocks, including major players like Nvidia and AMD, faced a sharp selloff as traders locked in gains from a month-long rally. The Information Technology sector was one of the hardest hit, with the Nasdaq sinking over 400 points. In contrast, Cisco Systems bucked the trend by jumping 13.4% after delivering a strong earnings beat fueled by massive demand for AI-powered networking infrastructure.