Meta's new Muse AI agent became the most downloaded free iPhone app in the U.S., sparking investor enthusiasm about increased CPU demand for agentic AI applications. Stock prices for chip makers Intel, Arm, and AMD surged on Monday as analysts project significant growth in the CPU market driven by AI inference workloads over the coming years.
Fed Chair Kevin Warsh and the FOMC raised the federal funds rate by 25 basis points to 3.75%-4.00% on September 16, the first hike since July 2023, signaling more increases ahead as the central bank pursues faster progress toward its 2% inflation target. Stock markets reacted negatively, with the Dow falling over 1%, though historical patterns suggest outcomes may differ from initial expectations.
Federal Reserve Chairman Kevin Warsh raised the federal funds rate by a quarter point in his third FOMC meeting, marking the first rate hike since 2023. Historically, rate-hiking cycles trigger an average 14% drawdown in the S&P 500 within 12 months, though the decline may not occur immediately and recovery typically follows as markets digest the effects on corporate earnings and inflation.