Investor optimism is fading and the types of A.I.
Peek of the Week
Weekly Market Commentary
March 23, 2026
The Markets
The interest rate outlook shifted.
Last week, central banks around the globe met to set policy rates. While most chose to leave rates unchanged, many expressed concern about the potential economic consequences of the War in Iran, reported Holly Ellyatt of CNBC.
“Central bankers in Japan, Indonesia and Taiwan opted to stay on the sidelines, as did their counterparts in the U.S., Canada, the U.K. and Europe. The notable exception was Australia, where policymakers narrowly voted to raise rates…,” reported Jihye Lee and Fabiana Negrin Ochoa in Morningstar News.
The Federal Reserve held rates steady
In the United States, the Federal Open Market Committee (FOMC), which is the Federal Reserve’s (Fed’s) rate-setting body, kept the federal funds rate unchanged. In addition, the FOMC summary of economic projections indicated Fed officials expect to see faster economic growth and higher inflation in 2026. Nicole Goodkind of Barron’s described the Fed’s current challenge:
“One rate cut technically remains on the table this year. But the bar to deliver it is higher. The Fed is caught between an inflation overshoot it can’t dismiss, an oil shock it can’t predict, a labor market on a knife’s edge, and a leadership transition tangled in legal uncertainty,” reported Goodkind.
At the post-meeting press conference, Fed Chair Jerome Powell indicated he plans to remain on the Fed board until a new Chair is confirmed and the current investigation of the Fed by the Department of Justice is finished.
Investor optimism faded
Investors considered the actions and rhetoric of global central banks and seemed to settle on the idea that policy rates could move higher this year. In response, bond yields began to rise.
“Global bond markets extended one of their biggest selloffs in a year on Friday, taking benchmark Treasury bonds sharply higher and weighing on stocks in markets around the world, with investors ripping up bets on central bank interest rate cuts as war in the Middle East shows no signs of ending,” reported Martin Baccardax of Barron’s.
Last week, major U.S. stock indexes moved lower, while yields on most maturities of U.S. Treasuries moved higher.
WHAT’S THE DIFFERENCE BETWEEN GENERATIVE AI AND AGENTIC AI? Many Americans rely on artificial intelligence (AI) tools every day, sometimes without realizing they’re doing so. Voice-activated home assistants, for example, are useful for checking the weather, setting reminders, or listening to music. Voice assistants are just one form of AI. Over the past few years, two more powerful approaches have emerged that are reshaping how we work: generative (gen) AI and agentic AI.
Gen AI: Responds to prompts
Gen AI chatbots have become widely available. This type of AI is reactive and task-oriented, helping people conduct research, draft emails, create images, write music, and code websites, reported Adam Zewe of MIT News. Gen AI systems:
Recognize patterns and rely on that knowledge to predict what comes next.
Respond to user prompts, which affect the quality of output.
One drawback is that AI chatbots can hallucinate, meaning they confidently generate inaccurate answers. When using gen AI, human guidance and oversight are required to ensure the quality of the end product.
AI agent: Acts on its own
Last year, agentic AI became more prevalent. Agentic AI systems are partially or fully autonomous, meaning they perceive, reason, and act without human supervision, according to Beth Stackpole of MIT’s Ideas Made to Matter. AI agents are:
Integrated with software systems to complete complex tasks independently, and
Contained by robust strategy and risk management frameworks.
There are risks and challenges to agentic AI. Stackpole cautioned that organizations implementing these tools may find them to be unreliable or prone to unethical behavior. There are also cybersecurity and accountability issues.
What do we want AI to do?
Recently, Bloomberg’s Sommer Saadi and Stephanie Flanders spoke with Nobel Prize–winning economist Daron Acemoglu, who believes that “the greatest economic benefits would come from ‘pro-worker AI’ that enhances human capabilities, enabling workers to perform more complex and valuable tasks. But current business incentives, market structures and policy frameworks favor labor replacement.”
As AI continues to evolve, the stakes of getting it right are becoming considerably higher. The question is no longer how AI can help us work smarter; it's how we ensure these tools serve people. Whether the future belongs to pro-worker AI or labor-replacing automation will depend less on the technology and more on the choices organizations, policymakers, and workers make today.
WEEKLY FOCUS – THINK ABOUT IT
“Even the darkest night will end and the sun will rise.”
― Victor Hugo, Author
Best regards,
Leif M. Hagen, CLU, ChFC
LPL Financial Advisor
Achievement Financial
Dream. Plan. Achieve.
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* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
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* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
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* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
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Sources:
https://www.cnbc.com/2026/03/19/ecb-boe-swiss-national-bank-riksbank-interest-rate-decisions.html
https://www.barrons.com/articles/powell-federal-reserve-interest-rates-e5af6407? or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/03-23-26-Barrons-Higher-Oil-Higher-Inflation%20-%203.pdf
https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20260318.pdf
https://www.federalreserve.gov/mediacenter/files/FOMCpresconf20260318.pdf [Transcript]
https://www.barrons.com/articles/treasuries-extend-slump-likelihood-of-fed-rate-cuts-fades-610329a2? or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/03-23-26-Barrons-Treasuries-Extend-Slump%20-%206.pdf
https://www.barrons.com/market-data?mod=BOL_TOPNAV or go to
https://resources.carsongroup.com/hubfs/WMC-Source/2026/03-23-26-Barrons-DJIA-S&P-Nasdaq%20-%207.pdf
https://news.mit.edu/2023/explained-generative-ai-1109
https://mitsloan.mit.edu/ideas-made-to-matter/agentic-ai-explained
https://www.bloomberg.com/news/articles/2026-03-18/podcast-ai-is-being-built-to-replace-you-not-help-you or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/03-23-26-Bloomberg-AI-Is-Being-Built-to-Replace-You%2011.pdf
https://www.goodreads.com/work/quotes/3208463-les-mis-rables