Good evening, you're tuned in to Markets Desk.
The Fed's preferred inflation gauge, the PCE index, fell for the first time since the pandemic, pulled lower largely by a drop in gas prices following a temporary Iran truce. While the headline number offers some relief, analysts caution that the underlying trend remains fragile and the Fed is unlikely to pivot on the strength of one reading alone.
Shifting to geopolitical risk, a Russian missile violated Polish airspace Thursday, crashing roughly sixty miles inside NATO territory after Ukrainian jets attempted to intercept the threat before it crossed the border. Warsaw scrambled F-sixteens and other aircraft in response. The incursion raises serious questions about Article Five exposure and adds a new layer of uncertainty to European security calculations.
On the earnings front, Meta and Microsoft delivered a study in contrasts around artificial intelligence spending. Microsoft's AI narrative landed well with investors, while Meta's message — that heavy capital expenditure will continue until returns materialize — was met with skepticism. The divergence signals that markets are no longer rewarding AI ambition alone; they want a credible path to monetization.
That's the tape. Markets Desk, signing off the floor.
