Global markets react to US rate hike and AI safety concerns

Global markets are reacting to a Federal Reserve interest rate hike, the first in three years, aimed at curbing inflation. While the move was largely anticipated, investors remain focused on the future trajectory of rates and rising Treasury yields.

In the technology sector, executives from OpenAI and Anthropic have called for a moderation in artificial intelligence development to prioritize safety. OpenAI CEO Sam Altman announced a delay in the company’s initial public offering to focus on these safety concerns, impacting shares of companies like Nvidia and Micron. Conversely, cybersecurity firms such as Palo Alto Networks and CrowdStrike saw gains due to anticipated spending on AI-related threats.

Energy markets faced volatility following a strike on a critical Saudi Arabian oil pipeline that bypasses the Strait of Hormuz. Despite the incident and low US crude reserves, oil prices remained relatively stable.

In Canada, Prime Minister Mark Carney introduced a ‘Productivity Mega Deduction’ to accelerate business capital deployment following an Investment Summit that secured nearly $500 billion in capital pledges. Meanwhile, retail trends show consumers shifting toward budget-friendly options like Dollarama due to rising living costs and trade tariff uncertainties.