Finance

Equity markets finished the week on a strong note Thursday, driven by a significant rebound in the technology sector following news of a preliminary ceasefire agreement between the U.S. and Iran. The deal, which aims to restore normal shipping through the Strait of Hormuz, helped offset earlier investor concerns regarding monetary policy. Semiconductor companies were particularly buoyant after a major partnership announcement between Intel and Apple for domestic chip production.

In his inaugural policy meeting as Chair, Kevin Warsh oversaw a decision to maintain interest rates while signaling a potential shift toward future hikes. Despite keeping the target range between 3.5% and 3.75%, the committee's updated outlook suggests at least one rate increase may be necessary before the end of the year to combat persistent energy-driven inflation. This more aggressive tone has led market participants to recalibrate expectations away from previously anticipated rate cuts.

Global oil prices have seen a sharp decline this week, with Brent crude falling nearly 9% as risks of supply disruptions in the Middle East recede. The reopening of critical shipping lanes is expected to gradually lower costs at the pump, which had spiked during recent months of conflict. While the energy sector saw some immediate downward pressure, the broader economy is expected to benefit from the easing of these significant supply-side inflationary shocks.