U.S. stocks set for rebound as inflation data, AI cloud updates steer market focus

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U.S. stocks rebound on inflation data

Highlights

S&P 500 and Nasdaq attempt to break a four-session losing streak amid steady bond yields and oil prices with WTI near $100 and Brent at $104.
IEA forecasts global energy supply will fall by 5.7 million barrels a day in 2026, intensifying risks as Wells Fargo cuts targets on several homebuilders due to 7% mortgage rates.
Oracle shares rise 6% on strong AI cloud results, Microsoft plans to triple data center capacity by 2032, and Adobe reports AI-first annual recurring revenue up 150% with 1 billion monthly users.

Market drivers and sector calls

As reported by CNBC, Friday's market agenda centers on inflation, energy prices, housing pressure and a fresh round of analyst calls across technology and consumer names.

The S&P 500 and Nasdaq are on track to try to break a four-session losing streak. Bond yields are flat but remain elevated, while oil eases slightly with WTI still near $100 a barrel and Brent around $104.

Energy remains a key risk factor as supply concerns in the Middle East persist. The International Energy Agency says global supply will drop by 5.7 million barrels a day in 2026, or 6% below last year, after a previous forecast of a 4% decline this year.

Higher rates are also starting to weigh on housing activity, with 30-year fixed mortgage loans at 7%. Wells Fargo cuts price targets on homebuilders Lennar, D.R. Horton, Toll Brothers and PulteGroup, as well as Masco, Stanley Black & Decker and Whirlpool, signaling broader caution on housing-linked demand.

AI spending and corporate earnings in focus

Technology names are drawing support from strong AI-related updates, led by Oracle, whose shares jump about 6% after AI cloud figures top expectations. The company also says new contracts do not require additional capital, easing some concerns about debt, although its fiscal 2027 outlook is described as fairly modest.

Microsoft plans to triple data center capacity by 2032 to 38 gigawatts, a move that could support suppliers tied to power generation for compute infrastructure, including GE Vernova. RBC starts Dell with a buy rating and a $640 price target, citing accelerating growth driven by AI infrastructure demand, while Goldman Sachs reiterates Nvidia as a buy with a $300 per share target.

Elsewhere, RH beats quarterly expectations on margins, earnings and sales, helping lift its shares despite a weaker outlook. Adobe also posts revenue and earnings per share above expectations, with AI-first annual recurring revenue growing 150% and monthly users reaching 1 billion, even as debate continues over the pace of its broader business growth.

Our earlier article on U.S. stocks staying under pressure ahead of key inflation data explained how higher Treasury yields and surging oil prices were weighing on sentiment while investors looked to CPI and major earnings reactions for direction. It also noted that energy was the standout sector as crude jumped, and that mortgage rates above 7% were pressuring housing-linked names amid elevated borrowing costs.

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