GLOBAL STOCKS DRIFT AS AI EARNINGS, BOND YIELDS AND WAR RISK CONVERGE

Developing story: Market levels, sanctions details and central-bank signals may change as the week’s events unfold.

Global markets opened the week on a cautious footing Monday as investors weighed three connected risks: a pending U.S. sanctions announcement on Iran, Nvidia’s upcoming earnings report and the Federal Reserve’s Jackson Hole symposium later in the week. Stocks were mixed to lower, oil eased after recent gains and the Canadian dollar weakened after the collapse of U.S.-Canada trade talks. The combination left traders facing an unusually dense calendar in which geopolitics, artificial intelligence valuations, bond yields and trade policy could all alter the direction of risk assets within days.

Reuters reported that global stocks slipped and oil prices eased as investors awaited details of threatened U.S. sanctions on Iran. U.S. Treasury Secretary Scott Bessent was due to hold a press conference outlining measures that Washington says are aimed at pressuring Iran over control of the Strait of Hormuz. The sanctions risk matters for markets because the strait remains a vital energy route and because a broader secondary-sanctions campaign could affect trading partners, refiners, shipping insurers and banks outside Iran itself. That uncertainty helped keep crude prices and equity sentiment sensitive to headlines.

The tech sector added a separate pressure point. Nvidia is scheduled to report second-quarter fiscal 2027 results on Wednesday, August 26, after the company’s quarter ended July 26. Nvidia’s results have become a broad market event because the company is central to the artificial-intelligence investment boom that has supported a large share of equity gains. Reuters reported that analysts were generally looking for quarterly revenue to almost double to around $92 billion, a level of expectation that leaves little room for disappointment if growth, margins or forward guidance show signs of slowing.

That concentration of expectations has made the Nasdaq and other growth-heavy indexes particularly vulnerable to shifts in sentiment. Reuters reported that S&P 500 futures and Nasdaq futures slipped early Monday as investors prepared for the sanctions announcement, Nvidia’s results and the Jackson Hole speech by Federal Reserve Chair Kevin Warsh. U.S. markets later showed a similar split, with the S&P 500 and Nasdaq under pressure while the Dow Jones Industrial Average rose modestly. The pattern suggested investors were not abandoning equities across the board but were reassessing areas where valuations are most sensitive to interest rates and earnings growth.

Bond yields remain the deeper transmission channel. Long-term U.S. yields rose sharply last week before Treasury announced support measures aimed at calming the market. Reuters reported that 30-year yields remained above 5%, close to a recent 19-year peak. Higher yields create competition for equities and increase the discount rate applied to future earnings, which is especially important for technology and artificial-intelligence stocks whose valuations depend heavily on future growth. If yields remain elevated, strong earnings may not be enough to support the most expensive parts of the market.

The Jackson Hole Economic Policy Symposium, hosted by the Federal Reserve Bank of Kansas City from August 27 to 29, gives investors another focal point. The 2026 theme is “Financial Innovation: Implications for Payments and Policy,” but markets will also watch for signals about inflation, financial conditions and the central bank’s reaction to the recent bond-market stress. Reuters reported that investors hope Warsh’s speech will provide clarity on the U.S. interest-rate outlook, though some analysts expect him to avoid detailed forward guidance. That uncertainty can itself become market-moving when expectations for policy rates are finely balanced.

Inflation is the link connecting Iran, oil, bonds and the Fed. Disruptions around Hormuz can raise crude and fuel prices, feeding consumer and business costs. Higher inflation expectations can push yields up, which pressures equities. If the Fed signals more willingness to tighten policy, risk assets could face another repricing; if it downplays inflation risks, bond investors could become more concerned about the credibility of price stability. Markets are therefore watching both the sanctions announcement and central-bank communication as parts of the same inflation and liquidity puzzle rather than separate stories.

Trade policy added a North American layer to the global backdrop. The dollar gained against the Canadian dollar after Canada said it would respond to U.S. tariffs with levies of its own following the breakdown in bilateral talks. Reuters reported that Canada plans tariffs on U.S. steel, dairy, appliances, agricultural equipment, pulp and paper products, electronics and some goods previously targeted by Washington. A prolonged trade dispute could complicate inflation and growth expectations because the two economies are deeply integrated, particularly in autos, energy, manufacturing and consumer goods.

The result is a market environment in which investors are waiting for confirmation rather than trading on a single dominant narrative. A sanctions package with limited enforcement could ease energy fears, while a broad secondary-sanctions campaign could revive oil and dollar demand. Nvidia could either validate the AI-led rally or expose overextended expectations. Jackson Hole could calm bond markets or deepen concerns about inflation and policy direction. Until those events resolve, the week’s early trading reflects caution: stocks drifting, oil easing from recent highs and investors keeping attention fixed on the next headline with market-moving potential.

Fact-check date: August 24, 2026. Article type: News. Sources: Reuters; NVIDIA; Federal Reserve Bank of Kansas City. Developing note: Market levels, sanctions details and central-bank signals may change as the week’s events unfold.