0724 | Nasdaq Slips, Oil Surges, and Moody’s Flags AI Spending Risk

Mia: From Bri, this is After Market. I'm Mia.

Milo: And I'm Milo. The Nasdaq 100 seals its first back-to-back weekly decline since late March. Oil shocks ripple across three global supply fronts simultaneously. And Moody's warns that unprecedented AI spending is threatening the credit quality of the biggest names in tech.

Mia: The Nasdaq 100 closed sharply lower on Friday, locking in its first back-to-back weekly decline since late March.

Milo: The sell-off was driven by a spike in oil prices and a rout in the technology stocks that had surged during the AI investment boom. Brent futures jumped past a hundred dollars a barrel as the conflict in the Middle East widened and Ukraine struck Russian infrastructure.

Mia: And Moody's piled on, warning that what it calls unprecedented AI spending threatens the credit quality of Amazon, Meta, Alphabet and others. So investors were hit with an oil shock, inflation concerns, rising bond yields, tariff worries, and deepening AI angst all at once.

Milo: Market commentary captured it bluntly: the short-sighted stock market can no longer brush off war, because, quote, it's too hard to ignore a hundred-dollar oil. Late in the session there was a counter-signal — Treasury yields slid as oil prices fell on hopes for new U.S.-Iran peace talks.

Mia: Oil markets are absorbing acute supply pressure on three distinct physical fronts, and a key diplomatic track has collapsed. Brent futures are volatile right around that psychologically important hundred-dollar-a-barrel level.

Milo: The U.S.-Iran ceasefire has broken down, and the escalation directly threatens crude flows through the Strait of Hormuz. Rapidan Energy Group raised its price forecast explicitly because of this, projecting Brent will hover near a hundred dollars a barrel not just past July but through the end of the year.

Mia: The price action shows enormous intraweek swings. On Friday, oil fell roughly three percent on a single report that Pakistan was pushing for new U.S.-Iran talks backed by China. Yet futures remained on track for a weekly jump of ten percent because of the wider war intensity.

Milo: And the supply disruption is not confined to the Middle East. Brent surged past a hundred dollars as the conflict widened while Ukraine simultaneously struck Russian infrastructure. In the Black Sea, Russia's top oil port halted loadings amid mounting safety fears — a major logistical choke point.

Mia: So shipments are under attack in the Red Sea, the Strait of Hormuz, and the Black Sea all at once. With the diplomatic off-ramp failing, President Trump is considering what sources describe as a massive attack on Iran. That posture erases the de-escalation pathway that briefly pressured prices lower on the Pakistan-China mediation report.

Milo: The market is now braced for a prolonged period of triple-front supply vulnerability and triple-digit crude prices.

Mia: Moody's has warned that unprecedented AI spending is threatening the credit quality of Amazon, Meta, Alphabet, and others. The ratings agency notes that the outlay is forcing even the most cash-rich corporations to lean heavily on debt, stock sales, and off-balance-sheet moves.

Milo: And we're already seeing market pushback. BlackRock saw softer-than-usual demand for a corporate bond sale tied to a Meta data center project in Texas, as investors grapple with concerns about excessive AI infrastructure spending.

Mia: Meanwhile, the sell chips, buy software trade reappeared as Wall Street capped another volatile week. The Nasdaq 100 tumbled under the combined weight of the oil spike and AI jitters hitting tech stocks.

Milo: On the cost side, Anthropic released a new AI model that it says rivals Fable 5 and is cheaper — arriving just as businesses are fretting about costs. And Intel rode the AI boom to its fastest revenue growth in almost fifteen years, yet its shares still sank.

Mia: U.S. consumer borrowing costs are facing upward pressure because many loan rates, including mortgages, peg to the ten-year Treasury yield, which has been moving higher.

Milo: Separately, a rapid sell-off in the high-flying momentum trade is hitting retail YOLO traders especially hard — producing their worst returns in four years.

Mia: Across the Atlantic, bond traders in Britain spent the new government's first week trying to price two competing forces: the spending ambitions of Andy Burnham's administration, and the impact of oil near a hundred dollars a barrel.

Mia: U.S. trading partners have rejected the forced labor rationale behind the new global tariffs, although most are signaling they will keep negotiating.

Milo: Separately, President Trump threatened the European Union with what he called substantial tariffs after its latest fine on Google, citing prior penalties against Apple, Meta, and Amazon.

Mia: And in currency markets, hedge funds have amassed the largest short position on the Canadian dollar in two years, with the threat of American tariffs weighing on the currency.

Mia: Intel posted its strongest revenue growth in nearly fifteen years with a twenty-five percent jump, driven by AI demand. But shares sank anyway.

Milo: Oracle signed a ten-year software contract with the U.S. Department of Defense worth up to seven billion dollars. And in Canada, miner Cadillac and its backers raised three hundred eighty-five million Canadian dollars in an upsized IPO.

Mia: Brooks Automation, a private-equity-backed robotics firm, is said to be weighing an IPO. Fitch upgraded Jane Street to high grade, citing income growth. And Vitol paid out five-point-nine billion dollars to traders even as its 2025 profit halved.

Mia: That's the rundown for this edition of After Market.

Milo: From Bri, thanks for listening.