The S&P 500 and Nasdaq posted their worst weekly performance since June, and many AI-linked companies entered bear market territory with declines of 20% or more. Hotter-than-expected inflation, with CPI at 3.7% and PPI at 6.2%, led investors to price in at least an 89% chance of another Fed rate hike this year, though most still expect no change at this month's meeting. WTI crude closed above $101 per barrel, while the 9% of companies that had reported third-quarter earnings averaged 29% growth. Year to date, the Dow is up 7%, the S&P 500 12% and the Nasdaq 13%, while Bitcoin is down 8%, Ether 19%, gold 3% and silver 19%. Based on earnings, the article says the S&P 500's P/E of 26.12 versus a historical average of 16.24 implies a maximum downside of 38%.
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