On September 17, the Federal Reserve (Fed), the US central bank, raised its benchmark interest rate for the first time in three years. This move is a warning that inflation remained too stubborn to ignore. As a result, stocks slid into their worst week since March. But the pessimistic mood did not last. Some days later, falling oil prices and fresh enthusiasm for artificial intelligence stocks sent the Nasdaq to a record high. The market is telling two stories at once: the rising cost of money, and a handful of companies that seem immune to it.

Equities. The S&P 500 ended roughly flat, down about 0.1%, after wobbling hard following the Fed’s decision. The Nasdaq Composite fared better, adding around 0.4% before jumping further on Monday to a record close, led by chipmakers Intel and Advanced Micro Devices. Europe’s STOXX 600 slipped 0.6% and Germany’s DAX fell 1.6%, while Japan’s Nikkei 225 climbed 1.4% and Hong Kong’s Hang Seng eased 0.4%.

What it means. Higher rates make future profits worth less in today’s money, which is why growth stocks in technology tend to wobble when the Fed raises rates to fight inflation. However, investors are betting that demand for artificial intelligence computing power is strong enough to keep lifting earnings regardless of interest rate levels, which is why a handful of chip and software names kept climbing while the rest of the market barely moved.

Rates and credit. The yield on the 10-year US Treasury note, a benchmark for mortgage and corporate borrowing costs, rose to 5.04%, its highest since 2007. Germany’s 10-year Bund held near 3.5%, but France’s OAT climbed toward 4.48%, pushing the extra yield France pays over Germany above 97 basis points (hundredths of a point), its widest gap since the 2011-2012 eurozone debt crisis.

What it means. A rising Treasury yield signals that investors now see inflation, not recession, as next year’s bigger risk, and it raises borrowing costs broadly. France’s spread reflects something else: investors demanding a bigger reward for lending to a government running a deficit above 5% of national income that has struggled to pass its own budget.

Currencies. The dollar strengthened broadly, while the euro slipped toward 1.16, the pound eased toward 1.36, and the yen weakened past 159. The Swiss franc, usually a refuge in stressful weeks, fell past 0.81, its weakest since July.

What it means. A stronger dollar and higher US yields move together, since money flows toward whichever currency pays more, which is why even the defensive franc gave ground.

Commodities. Brent crude dropped from above USD 105 a barrel to near USD 101, briefly falling toward USD 96 the following week, on hopes of a breakthrough in Middle East talks. Gold continued its retreat from January’s record above USD 5,589 an ounce to near USD 4,300. Copper bucked the trend, climbing toward USD 6.75 a pound on strong demand from China.

What it means. Falling oil eases the inflation pressure that worried the Fed, since energy costs feed into what households pay. Gold’s slide shows that rising yields reduce the appeal of an asset that pays no interest. Copper’s gain suggests manufacturers are still buying the physical metal, a sign that the global economy has not slowed as much as bond markets fear.

The Week Ahead. Investors will watch the personal consumption expenditures price index, the Fed’s preferred inflation gauge, due out on September 26, for evidence that the rate rise was justified. Flash business surveys, jobless claims and earnings from General Mills and Cintas will help gauge the economy’s health. France’s budget standoff remains unresolved and could keep pressuring its bonds. The real question: does the data give the Fed room to pause, or push it toward another hike?