Inflation Rattles Markets Ahead Of Fed Meeting; AI Stocks, Crypto Pause As Gold, Oil Advance: This Week In The Markets

Zinger Key Points
  • Surging inflation rattles Fed's rate cut plans; stocks, crypto fall, commodities like gold and oil soar.
  • AI stocks may rebound despite pullback. Cruise sector optimism, Boeing stock sale scrutiny, TikTok bill advances amid debates.

Inflation reports unveiled in the week preceding the Fed meeting brought an unwelcome news to investors. Prices pressures surged more than expected in February, creating a headache for Federal Reserve Chair Jerome Powell, who had been pushing for greater confidence regarding the disinflationary trend before contemplating interest rate cuts.

Stocks flipped to the red after Thursday's producer inflation data confirming concerns that emerged two days earlier in the consumer inflation report.

As market participants dialed back rate cut bets, risk sentiment faded with crypto and Bitcoin BTC/USD dragged to losses. Meanwhile, commodities outperformed, with gold holding near all-time highs and oil surging above $80 a barrel.

Powell’s Rate Dilemma

As inflation reasserts its presence, Fed Chair Powell faces pressure on the path to cut interest rates. Expert opinions on rate direction​s are now diverging, creating an uncertain policy scenario.

AI Stocks Exit?

Investors pulling out of AI tech stocks like NVIDIA Corp. NVDA, Advanced Micro Devices Inc. AMD and Microsoft Corp. MSFT may be acting prematurely, suggests Light Street Capital’s Glen Kacher. Kacher advises that we’re early in the AI investment cycle, making current valuations reasonable and highlights the potential growth of select “AI Five” companies.


Cruising’s Rising Tide

Goldman Sachs adopts a bullish outlook on the cruise sector, favoring Royal Caribbean Cruises Ltd. RCL and Carnival Corp. CCL due to industry shifts and expected pricing tailwinds.

Congressman’s Boeing Sale

A congressman’s sale of Boeing Co BA stock just before a Department of Justice investigation announcement raises concerns over potential insider trading. The trade’s timing, especially given his committee position, has sparked calls for further investigation into whether non-public information influenced the decision.

TikTok Bill Advances

The U.S. House’s approval of a bill targeting TikTok has left many influencers anxious, given the app’s vast American user base of 150 million. The legislation’s progression underscored growing concerns over the app’s Chinese ownership and data security implications​.

Musk Critiques TikTok Bill

Elon Musk voiced concerns about the proposed TikTok bill. He believed the bill was overly broad and susceptible to future misuse, reflecting growing debates over the app’s fate in the U.S. amid speculation of forced sales or bans.

Cannabis Stocks Surge

Speculation around the DEA’s impending rescheduling of cannabis to Schedule III fueled a significant rally in cannabis stocks on Friday. This move, anticipated to foster industry growth, sparked widespread optimism and strategic positioning among investors.

Photo: Shutterstock

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