Markets spent the past week pulled between two stories. Investors grew uneasy about how much the largest US technology companies are spending on artificial intelligence infrastructure, sending tech shares lower for a second straight week, while the conflict between the United States and Iran kept oil prices elevated. Both pressures eased into Friday, letting stocks recover ground and oil retreat from its highs.

Equities

The first story centred on Alphabet, Google's parent. Shares fell more than 7% on Thursday, their worst day in over a year, after the company raised its planned 2026 AI spending to as much as $205 billion and revealed that free cash flow — the cash left over after running and investing in the business — had turned negative for the first time since Alphabet's 2004 stock market debut. The reaction was swift: nearly $800 billion wiped off the largest technology companies in a single day, with the drop rippling into tech stocks in Asia too. The S&P 500, an index of 500 large US companies, slipped 0.6% over the week; the Nasdaq, dominated by tech names, fell 2.1%. Investors weren't rejecting AI itself — they were asking, for the first time in this boom, how long companies can keep spending this heavily before it shows up on the bottom line.

Commodities

The second story played out half a world away. Fighting between the United States and Iran, including attacks by Iran-aligned militants on oil tankers in the Red Sea, pushed Brent crude, the international oil benchmark, toward $100 a barrel. Then, on Friday, both sides held their fire, and oil fell roughly 4% to near $97 — a reminder of how quickly geopolitical premiums build, and unwind, in energy markets.

Currencies

One detail captured how unusual the week was: the Swiss franc, the currency investors normally reach for in times of stress, weakened instead — its softest level in about a year. The dollar simply pulled harder, supported by new tariffs and its own safe-haven bid. Even reliable habits didn't hold.

The Week Ahead

The week ahead brings the next chapter of both stories. Amazon, Meta and Microsoft report earnings, offering fresh evidence on whether Big Tech's AI spending is starting to pay off — or wearing thin with investors. Central banks in the US, UK and Japan all meet, though none are expected to move rates. Whichever story dominates will likely set the tone for markets into August.