TradingKey Daily Market Briefing: Oil Tops $100, US Stocks Under Pressure as Fed Rate Hike Fears Rise, Meta Bucks Trend to Surge

Tracking Market Trends

TradingKey - On September 9 Eastern Time, the three major US stock indexes continued to close lower. Escalating Middle East conflict pushed Brent crude past $100 a barrel, with rising energy prices further fueling market concerns over persistent inflation, while the 10-year US Treasury yield rose to its highest level since November 2023. Investors are awaiting Thursday's PPI and Friday's CPI data to gauge whether the Federal Reserve will need to raise interest rates further at its September meeting.

At the close, the Dow Jones Industrial Average fell 0.77% to 52,386.25; the S&P 500 Index dropped 0.48% to 7,636.46; and the Nasdaq Composite Index declined 0.64% to 26,253.34.

Among individual stocks, Meta (META) bucked the trend to surge over 6%. The company launched its AI assistant Muse, which can perform tasks such as sending emails, booking travel, and making payments upon user authorization, as the market focuses on the future commercialization capability of Meta's massive AI capital expenditures. AMD (AMD) rose 3.04%, driving the Philadelphia Semiconductor Index up 0.37%.

Alphabet (GOOGL) fell 2.28%. Google announced it will invest at least 13 billion euros, or about $15.1 billion, over the next two years in Finland to build AI infrastructure, including three new data centers. Apple (AAPL) dropped 0.28% as the company introduced its first foldable iPhone at its first major launch event under new CEO John Ternus.

In commodities, international oil prices surged. Brent crude (UKOIL) rose 2.37% to settle at $101.74 a barrel; WTI crude (USOIL) gained 2.57% to close at $96.68 a barrel, both marking their highest closing prices since May. Iran stated that after the US sank five Iranian tankers, it launched attacks on 10 vessels near the Strait of Hormuz, further heightening regional energy transport risks.

In precious metals, gold (XAUUSD) rose 1.06% to $4,401.85. The US dollar remained near a two-week low, which, combined with escalating Middle East risks, provided support for gold; however, rising US Treasury yields and Fed rate hike expectations continued to cap the upside for gold prices.

In cryptocurrencies, Bitcoin (BTCUSD) fluctuated around $78,000, peaking near $79,700 intraday, while Ethereum traded around $2,490. Despite simultaneous gains in oil prices and US Treasury yields, Bitcoin performed relatively stably during the day, though it failed to break back above the $80,000 threshold.

Market News

The US-Iran conflict continues to escalate, further elevating energy transport risks in the Strait of Hormuz. Iran stated that it launched attacks on 10 vessels near the Strait of Hormuz after the US sank five Iranian oil tankers. A latest Reuters survey also showed that even with some tankers turning off AIS for "dark sailings," about one-third of oil exports from the Gulf region have still not recovered to pre-war levels.

The US Department of the Treasury announced a buyback of up to $6 billion in long-term Treasuries. The Treasury will buy back 10- to 20-year Treasuries on September 10, tripling the size of its previous long-term bond buyback, primarily aimed at improving off-the-run liquidity. However, as some investors had previously expected the buyback size to reach $8 billion to $10 billion, long-term US Treasury yields continued to rise after the news was announced.

Google to invest $15.1 billion in Finland to build AI infrastructure. Google plans to invest at least 13 billion euros over the next two years and build three new data centers, while signing a 22-year nuclear power purchase agreement with Finland's Fortum to buy up to 50% of a nuclear power plant's output. This is also Google's first nuclear power agreement signed outside the United States.

Apple introduces its first foldable iPhone Duo, starting at $1,999. Featuring a 7.6-inch inner screen and the A20 Pro chip, the new device marks Apple's most significant form factor adjustment since the 2017 iPhone X. The company also introduced the iPhone 18 Pro series, raising prices by $100 due to rising memory costs.

Most economists still expect the Federal Reserve to stand pat in September. A latest Reuters survey shows that about 70% of economists expect the Federal Reserve to keep the interest rate target range unchanged at 3.50% to 3.75% at its September 15–16 meeting, but this proportion is down from about 90% in the August survey. Meanwhile, financial market pricing indicates an approximately 60% probability of a 25-basis-point rate hike in September, showing that a clear divergence remains between the market and economists.

Barclays raises year-end S&P 500 target to 7,950 points. Barclays raised its year-end 2026 S&P 500 target from 7,800 to 7,950 points and increased its full-year EPS forecast from $337 to $365, primarily citing continued growth in corporate earnings and AI investment. However, the institution also noted that high valuations, inflation, the Middle East situation, and interest rate prospects remain key risks.

US crypto regulation bill faces crucial vote next week. The US Senate is expected to hold a key procedural vote on the Clarity Act on September 15. The bill aims to further clarify digital asset classifications and regulatory authority scope. The crypto and banking industries are currently lobbying intensively around the bill, the outcome of which could impact the future regulatory framework for the US digital asset industry.

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