GLOBAL stocks rose yesterday, underpinned by gains in technology stocks, as investors waited for corporate earnings this week that could test an AI trade under pressure.
Gains in tech stocks kept Europe’s STOXX 600 afloat, while futures tracking the tech-heavy Nasdaq led gains on Wall Street with a 1.3 per cent rise. Chip stocks including those of Micron Technology and Marvell were about 6pc higher in premarket trading.
Trade was also in the spotlight after a Financial Times report said that President Donald Trump was planning on unleashing fresh duties on several countries this week, just hours after he slapped 50pc tariffs on Canadian imports worth about $20 billion.
“I suppose there’s a feeling that it’s going to be watered down, and ultimately, it’s certainly not going to happen to the tune of 50pc,” Morrison said earlier of Trump’s tariff threat against Canada.
Investor focus this week will be on earnings from companies including Alphabet and Intel to gauge the impact of the war and whether the AI trade has more room to run, given sky-high profit expectations for the second quarter.
July has been a rough month for global tech stocks, as strong earnings from Asian chip bellwethers Samsung Electronics and TSMC in recent weeks did little to assuage concerns about high valuations and earnings growth.
“While market volatility may pick up as investors assess the ongoing risks, we see a constructive macro and earnings backdrop that should continue to support global equities in the coming months,” UBS analysts wrote in a note.
Escalating US-Iran tensions have revived worries about inflation and pushed Treasury yields higher. The two-year note yield, which typically moves in step with Federal Reserve interest-rate expectations, was at 4.2pc, down 1 basis point on the day, following Monday’s selloff, which pushed yields up 4 basis points.
Traders are pricing in at least one rate hike from the Fed this year, and a roughly 20pc possibility of a second, according to money markets.
The dollar hovered near one-week highs against a basket of major currencies. The euro last bought $1.142, while the Japanese yen was at 162.74 per dollar, still within sight of 40-year lows, which is keeping traders on alert for intervention from Tokyo.
Sterling was the worst-performing major currency, as investors awaited the new government’s fiscal plans following the unexpected announcement of John Healey as the UK’s new finance minister. The pound was down for a fourth day, last trading at $1.341, down 0.2pc.
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