Finance

Strong economic data, including a robust S&P Global PMI and a drop in weekly jobless claims to 196,000, have heightened fears of further monetary tightening. Statements from Federal Reserve officials indicated that the central bank may need to execute an additional interest rate hike later this year to counter sticky inflation. This has pushed market expectations for an October interest rate increase significantly higher, keeping investors cautious.

Despite widespread losses across most S&P 500 sectors, the Communication Services sector emerged as a bright spot, gaining roughly 1.5%. The advance was spearheaded by Meta Platforms, which saw its shares jump 4% following announcements from CEO Mark Zuckerberg regarding monetization plans for the company's Muse AI agent. Walt Disney and Verizon also recorded notable gains, helping the tech-heavy Nasdaq stage an intraday comeback.

Bitcoin and Ethereum led a broad digital asset selloff, with Bitcoin dipping toward the $84,000 threshold and Ethereum falling near $2,680. The drop followed a broader pull-back in risk assets triggered by rising bond yields and the legislative stalling of the Clarity Act in the U.S. Senate. Despite the immediate price correction, underlying institutional demand remained strong, highlighted by nearly $1.7 billion in net inflows into U.S. spot Bitcoin ETFs earlier in the week.