Rate Fear Returns: Four-Day Slide Tests Nasdaq as Oracle Shines and Adobe Stalls

The selloff stretched into a fourth day and hardened. The daily scoreboard was clear: the S&P 500 and Nasdaq closed lower, the Dow finished in the red, the 10-year yield jumped 12 basis points toward 4.95%, and oil held above $100 even on a calm day. No single data point triggered it; a hot PPI print, hawkish signals from Europe, headlines from Yemen, and Iran-driven oil anxiety all landed on the same session. The market's question was equally clear: will the Fed raise rates next week?

Market breadth looked worse than the indexes. Decliners outnumbered advancers two and a half to one on the Nasdaq, the share of S&P 500 stocks above their 200-day average slipped to 54.5%, and only 33.4% held above their 50-day line. SPY leaned on its 50-day, the Nasdaq slipped beneath it, and semiconductors — resilient until then — gave in and retreated to the same line. With the options market flagged as entering a stressed regime, the technical picture deteriorated further.

Part of the pressure came from a tug of war in bonds. The Treasury's buyback move in long-dated paper lifted yields instead of calming them, and big players used the reaction to test the new Fed chair and the Treasury chief. The European Central Bank's second hike of the year, lifting its rate to 2.5%, reinforced the view that Washington cannot stay detached if Europe tightens. The result: the priced-in odds of a 25bp hike at next week's meeting jumped to 70%.

PPI and CPI should not be confused. Headline PPI ran hot but almost entirely on energy; services components showed no alarming picture, and companies absorbed part of cost increases through efficiency instead of raising prices. Energy is excluded from core CPI and from the core PCE gauge the Fed watches most closely, and AI-driven hardware costs sit outside the CPI basket as well. Hence no negative surprise was expected from today's CPI — though even a benign print was unlikely to stop markets from pressing the Fed.

Geopolitics feeds inflation through oil, and inflation feeds rate expectations. Crude held above $100 while broader commodity indexes tilted higher. The picture in Yemen flipped within a day: the Houthis, thought to be retreating, turned out to be advancing, with Yemeni government forces struggling and expected air-defense support from Saudi Arabia and Pakistan failing to materialize. Iran and Gulf states discussed a Hormuz transit arrangement via the Oman channel, but without US backing the talks hung in the air; neither Washington nor Tehran looked eager for a deal.

The day's good news came from Oracle. EPS of $1.92 beat the $1.74 consensus by roughly 10%, and revenue of $19.35 billion topped the $19.13 billion estimate. Net income jumped from $2.9 billion to $4.8 billion, with gross margin hitting 74.4% — a level reminiscent of chip giants. Data-center growth of 121% alongside a swelling backlog of remaining obligations suggested accumulated demand converting, not a one-quarter spike.

The blemish sat on the liability side. Oracle carries around $118.9 billion in debt, and although operations generate cash, capital spending keeps free cash flow negative — so deleveraging capacity has yet to recover. That explains the market's caution in valuation models. My balance: if revenue keeps growing at this pace, earnings follow with a lag and lenders relax; until then the stock stays under pressure.

At Adobe a good quarter was not enough. Despite rising AI-linked revenue, soft guidance for next quarter pressured the shares; intraday losses extended after the close and the hoped-for bounce never arrived. The name was being watched as a short-term rebound trade rather than a long-term holding — and that trade failed. Uber told the opposite story: the CEO's roughly $10 million open-market purchase ranked as the largest insider buy in company history. Such buys are usually a constructive signal but work with a lag and never constitute a thesis alone; with robotaxi competition ahead, the long-term view on Uber stays cautious.

SpaceX and Tesla stayed in the green on a red day. SpaceX disclosed a $1.1 billion AI and data-center services agreement with an unnamed customer — a meaningful step toward the discussed $100 billion recurring-revenue goal for end-2026. At Apple the launch momentum continued: the stock rose about 2.5%, helped by well-received wearable features such as tap-to-translate on new earbuds and deeper AI integration in the watch. The classic flight-to-safety bid for Apple on fearful days added to the gain.

Two AI product stories stood out. OpenAI opened a finance-specific ChatGPT edition connected to sources such as LSEG, Daloopa, and PitchBook for research and modeling work, initially for large institutions only. The emphasis on grounded data matters because confabulation is dangerous in finance. On the science front, Navier-Stokes and Birch-Swinnerton-Dyer claims surfaced, with a Lean-certified proof asserted. The corporate call to slow frontier models together read as a two-sided move — feeding AI anxiety while marketing the company's own pipeline.

The week's sharpest security publication came from Anthropic. Its February 23 study says DeepSeek, Moonshot, and MiniMax ran systematic extraction campaigns against Claude across tens of thousands of accounts; the most striking claim is that users thinking they used Moonshot were served by Claude behind the scenes. Criticism followed quickly: detecting that pattern implies user activity is monitored, raising privacy questions. The search for fixes is accelerating: the Nebius-Palantir tie-up and Nvidia's move to run open Nemotron models on Palantir platforms point to private deployments where corporate data stays inside. Near term, attention stays on today's CPI and pressure into Fed week; September seasonality and paused buybacks keep the wind at sellers' backs.