#美联储继续按兵不动 #美股财报季 The Nasdaq plunged 6.7% in October; the real danger may come between March and September 2027

In the October that just ended, U.S. tech stocks went through a significant bout of turbulence. The Nasdaq 100 fell 6.7% for the month, its worst monthly performance since March 2025. Google plunged 13% in a single day, Meta fell a cumulative 12% after its earnings report, and Amazon's free cash flow shortfall came close to $35 billion.
Many have attributed this downturn to the bursting of the AI bubble. But AI is only the surface-level cause. What is truly worth watching is the energy crisis triggered by the war in the Middle East, and the new wave of inflation and rate hikes it could bring. If the war in the Middle East cannot end soon, March to September 2027 may be the period when U.S. stocks and global risk assets truly need to be on guard.

01 The AI bubble is just the trigger; cash flow is what the market is really worried about
Over the past two years, the market has been very generous in how it values AI companies. As long as they had computing power, models, and data centers, capital markets were willing to assign them high valuations. When these investments would pay off seemed unimportant.
But things have changed. Amazon, Meta, and Google are all building data centers on a massive scale. Capital spending keeps climbing, while free cash flow is coming under pressure. Amazon's free cash flow shortfall this quarter came close to $35 billion, and Google's free cash flow was negative for the second consecutive quarter. More concerning, Google's search business is also facing competitive pressure from AI search. On one side, AI businesses need continuous funding; on the other, traditional cash-cow businesses may come under pressure. The software industry is facing the same issue. Products from Anthropic and OpenAI are beginning to challenge the business models of traditional software companies. ServiceNow's quarterly sales guidance fell short of expectations, and its stock posted a record 31% drop on Thursday; Twilio fell 18% on Friday after disappointing guidance; and Fortinet lowered its services sales forecast, triggering a sell-off in cybersecurity stocks.
The market is changing the rules of the game: investors used to be willing to pay a premium for AI's future, but now they are asking about revenue, profits, and cash flow. The long-term outlook for the AI industry has not changed, but the period of unconditional gains in AI stocks may be over.

02 The real variable: When will the war in the Middle East end?
The energy shock caused by the war in the Middle East is more concerning than the returns on AI investments. This is the key issue. The Middle East is one of the world's most important energy-supply regions.
If the war continues to escalate, oil supplies, transport routes, and energy infrastructure could all be affected. Even without a major supply disruption, as long as the market remains concerned about supply risks, crude prices could stay elevated for a long time. Rising crude prices affect far more than gas stations. The impact passes through to gasoline, diesel, air transport, logistics, chemicals, and manufacturing, ultimately driving up companies' production costs and households' living costs. This means the progress the United States has just made in controlling inflation could be undermined by the war in the Middle East. More troublingly, rising energy prices are a typical supply shock. The Federal Reserve can curb demand by raising rates, but it cannot directly increase oil supplies or end the war in the Middle East.
But if inflation stays high as a result, the Fed will find it difficult to cut rates easily and may even return to a rate-hiking cycle. On November 1, CME FedWatch data showed a 29.3% probability that the Fed will leave rates unchanged in December, and a 70.7% probability of a 25-basis-point hike. The Fed also made clear that inflation remains elevated.

03 March to September next year may be the biggest risk window
There are two possible scenarios for future Fed policy.
Scenario 1: The optimistic case—the war in the Middle East ends early.
If the war meaningfully de-escalates in the next few months, reducing oil supply risks and bringing crude prices down, inflationary pressure in the United States may gradually ease. In this case, the Fed may bring this round of rate-hiking pressure to an end around March 2027, and the market may have a chance to price in rate-cut expectations again.
Scenario 2: The pessimistic case—the war in the Middle East drags on.
If the war continues into the first half of 2027, with energy supply risks unresolved and oil prices staying high for a long time, U.S. inflation may flare up repeatedly. The Fed may not only raise rates again in December 2026, but may also continue tightening monetary policy in 2027. In this case, rate hikes and a high-interest-rate environment could persist until September 2027. This is the scenario that requires greater caution and is highly likely to occur. It is worth emphasizing that saying this could continue until next September does not mean the Fed will necessarily raise rates at every meeting. Rather, it means that rate-hiking pressure could persist and policy rates could remain at restrictive levels for a long time. The biggest difference between the two scenarios is not how well the AI industry develops, but when the war in the Middle East ends. The end date of the war may determine when the next round of global monetary easing begins.

04 How should ordinary investors respond?
If the above assessment is correct, investors need to watch three areas over the next few months. First, crude oil prices. They are the most important leading indicator of this round of macroeconomic risk. Don't just watch the Fed's statements; pay closer attention to whether the situation in the Middle East is truly easing and whether oil supplies are returning to normal.
Second, U.S. inflation and Treasury yields. If energy prices continue to rise and inflation expectations pick up again, the 10-year Treasury yield may remain under pressure, which would also affect tech stock valuations.
Third, the free cash flow of tech giants. AI investment ultimately has to translate into revenue and profits. Otherwise, even if the Fed stops raising rates, high-valuation companies may not regain favor with the market.
The crypto market also requires caution. Although Bitcoin has its own supply-and-demand and cyclical dynamics, highly volatile assets are often more vulnerable when dollar liquidity is tightening and global risk appetite is falling. Don't blindly buy the dip.

Over the past few years, AI has been the market's dominant trade; in the coming quarters, the focus may shift back to energy, inflation, and monetary policy. AI determines the tech industry's long-term growth potential, but the war in the Middle East may determine when global liquidity eases again. If the war ends early, March 2027 could be an important turning point; if it drags on, the real test may continue until September 2027.$NAS100