According to BlockBeats, global markets this week focused on cooling inflation, Federal Reserve policy, tensions in the Middle East and the ongoing wave of AI investment.
U.S. inflation data for July came in softer, leading markets to sharply scale back expectations for another rate hike this year. July CPI rose 3.4% year over year, while core CPI increased 2.5%. PPI growth slowed to 4.7%, and expectations for a September Fed hike fell noticeably after the data.
Long-dated Treasuries stayed under pressure
That shift in rate expectations did not bring relief to the long end of the U.S. bond market. The yield on the 30-year U.S. Treasury rose to 5.22%, the highest level since 2001. Investors remain concerned that a widening U.S. deficit is pushing long-term financing costs higher.
Middle East tensions remained in focus
Geopolitical risk also intensified during the week. Donald Trump said the United States would declare the Strait of Hormuz to be “U.S. territory” after “defeating Iran,” and said Washington would impose additional economic pressure on Iran.
Iran responded by saying that only Iran can decide whether the strait stays open or closed. The U.S. military has also continued to strengthen its regional deployment, with the USS Washington moving to the Middle East for rotational coverage.
AI stayed at the center of capital flows
The AI buildout continued to expand in capital markets. Nvidia, together with BlackRock, Blackstone and Goldman Sachs, plans to mobilize more than $500 billion to support AI data center construction. Jensen Huang said AI computing is becoming a new kind of infrastructure, comparable to energy and transportation. At the same time, the market has started paying closer attention to risks in AI financing models.
South Korean equities rallied strongly. The KOSPI rose nearly 22% from its late-July low and re-entered a technical bull market. Samsung Electronics and SK Hynix led gains as demand for AI servers and HBM continued to rise, putting the AI supply chain back at the front of investor positioning.
AI valuations kept heating up
According to reports, Anthropic is planning an IPO, and market expectations suggest its valuation could reach $2 trillion. OpenAI is also accelerating its commercial push, with annualized revenue reportedly surpassing $40 billion.
Among big tech companies, Apple was reported to be working with Alibaba to train a China-specific large model, adjusting its localized AI strategy for the Chinese market. Separately, there is still debate over whether Apple’s 20th-anniversary “all-glass iPhone” project will move forward.
Risk appetite improved, but warnings remain
In equities, the S&P 500 and the Nasdaq both moved higher this week as investors returned to the “rate-cut expectations plus AI earnings delivery” trade.
Bank of America, however, warned that bullish market sentiment is approaching extreme levels last seen in 2021, with geopolitical risks and valuation pressure still in view.