Asian Stocks Boom as AI Momentum Fuels Market Optimism
Asian stock markets boom as investors poured money into AI-related sectors, pushing global equities higher. Gold stayed above $4,000 an ounce, while the dollar held firm after its strong recent gains.
AI-Focused Rally Boosts Global Equities
A renewed surge in AI enthusiasm sent the S&P 500 and Nasdaq to fresh record highs, as investors continued to buy on dips. Analysts at JPMorgan said in a note that the “AI theme remains intact,” with billions flowing into the technology sector daily.
They added that estimates for tech earnings growth have climbed to 20.9% for the upcoming reporting season, up from 15.9% in June. Around 81% of tech stocks have seen upgrades, led by Nvidia and Apple. Overall, earnings are expected to grow by 8% in the third quarter, with revenues rising 6.3%.
Japan’s Nikkei gained 1.4%, edging closer to its all-time high, boosted by foreign inflows worth 2.5 trillion yen ($16.4 billion) in the week ending October 4. Taiwan’s benchmark index rose 1.2% to a new record, while MSCI’s broad Asia-Pacific index excluding Japan firmed 0.3%.
Chinese blue chips also advanced 0.4% as markets reopened after a week-long holiday. Beijing introduced new restrictions on rare earth exports and related equipment, a key issue in ongoing trade discussions with the US.
Oil and Gold Shift Amid Ceasefire Progress
Oil prices eased after news that Israel and Hamas had agreed to the first stage of a ceasefire plan to end their two-year conflict. US President Donald Trump said he might visit Egypt this weekend to discuss further steps in the peace process.
Brent crude slipped 0.6% to $65.89 a barrel, while US crude fell 0.7% to $62.12. Gold eased slightly to $4,031 an ounce but remains nearly 4% higher this week, supported by expectations of US interest rate cuts and central bank buying.
Fed Outlook and Currency Moves
Minutes from the latest Federal Reserve meeting showed most policymakers still favour more rate cuts, despite concerns over inflation. Markets are pricing in a 94% chance of another quarter-point cut in November and about 44 basis points of easing by year-end.
Citi economists said further weakness in the labour market would likely push the Fed to lower rates at each of its next four meetings. Ten-year Treasury yields slipped slightly to 4.115%.
The dollar hovered near eight-month highs at 152.54 yen, up 3.5% this week amid worries over increased Japanese borrowing. The euro steadied at $1.1641 after touching a six-week low on weak German industrial data.
with inputs from Reuters