Last week ended with headwinds across several sectors but held near its highs, while CPI and earnings announcements are expected to be the focus of market attention this week. The cut to OpenAI's revenue outlook heightened caution over AI investment.
Last week, the Federal Reserve's FOMC minutes were viewed as hawkish, prompting expectations that persistent inflation risks had accelerated the move toward maintaining high interest rates for longer. At the same time, a cut to OpenAI's annualized revenue outlook raised doubts about the sustainability of AI infrastructure investment, unsettling investors' views of AI-related stocks.
The market outlook for this week is focused on the consumer price index (CPI), which will be released next week, and the start of earnings season. Whether inflation will justify the Fed's hawkish stance will be a key focus, while corporate earnings and cash flow levels reported during the earnings season could affect valuations of technology and growth stocks.
Early earnings announcements by major financial institutions are expected to continue, and trends in each company's earnings and cash flow are expected to affect the market's risk assessment.