Market Updates

U.S. stocks entered October on firm footing, but confidence weakened as investors confronted renewed inflation pressures and growing questions about the sustainability of the AI boom. Semiconductor and AI infrastructure shares came under pressure amid concerns over elevated valuations, Chinese competition, and the cost of financing massive AI investments.

September opened with markets confronting a less comfortable mix of resilient growth, sticky inflation, and renewed energy pressure. Escalating conflict involving Iran disrupted oil flows through the Strait of Hormuz and Red Sea routes, pushing crude prices higher and reviving concerns that the energy shock could keep inflation elevated.

Markets regained momentum in early August as investors looked past July’s technology selloff and grew more comfortable that the Federal Reserve may not need to raise rates in September. Strong second-quarter earnings helped restore confidence in the artificial intelligence trade, while gains broadened beyond mega-cap technology into smaller companies and other economically sensitive areas.

The second half of 2026 opened with markets balancing three competing forces: renewed U.S.-Iran hostilities, the first meaningful inflation relief in months, and the start of second-quarter earnings season. Stocks entered July with considerable momentum after the S&P 500 and Nasdaq Composite posted their strongest quarters since 2020, and the Dow Jones Industrial Average notched back-to-back record closes in the opening days of the month.