Finance

Alphabet suffered a sharp 7% decline after revealing its updated capital expenditure plans, which include full-year expectations rising up to $205 billion. Despite reporting positive top-line growth metrics for the quarter, the heightened AI infrastructure costs and a regulatory fine from the European Union spooked investors.

Brent crude futures crossed the $100 per barrel threshold for the first time in two months following an escalation in military exchanges involving the United States, Iran, and Houthi forces in the Red Sea. The sudden energy price surge has renewed macro inflation anxieties and caused a corresponding sell-off in sovereign bond markets.

The yield on the 10-year U.S. Treasury note shot up to its highest level in roughly a year and a half, fueled by fears that high energy costs will sticky inflation. Market participants are increasingly adjusting their expectations to factor in a higher probability of subsequent Federal Reserve interest rate hikes.