Global Markets Climb as AI Enthusiasm Meets Mideast Diplomacy

The pan-European STOXX 600 index rose 0.1% as investors parsed signals from U.S.-Iran talks, which President Donald Trump characterized as productive. While tech optimism buoyed sentiment, individual results remained mixed: Novo Nordisk shares slid 4.2% following disappointing Wegovy weight-loss pill sales, and HSBC shares dipped 3% in the wake of its recent earnings report. In Asia, the Nikkei surged 3.7% to its highest level since late July, fueled by heavy capital expenditure in AI infrastructure.

Despite the broader rally, high-growth sectors faced scrutiny. Chipmaker AMD fell 7% in premarket trading after investors found its latest results insufficient to meet lofty valuation expectations. SpaceX also faced pressure, dropping 10% amid concerns that its aggressive investment program is straining cash flow. Chris Weston, head of research at Pepperstone, noted that while the firm executes strongly, its ambitious roadmap will almost certainly necessitate additional capital infusions in the coming years.

Commodity and currency markets reflected the shift in geopolitical risk. Brent crude retreated from its July peak of $102, trading at $79.95, as ship-tracking data suggested flows through the Strait of Hormuz are recovering more quickly than initially anticipated. This stabilization in energy costs prompted a retreat in 10-year Treasury yields to 4.606%. Meanwhile, gold climbed 2.2% to $4,166 an ounce, benefiting from the broader decline in yields. Investors now turn their attention to the upcoming U.S. jobs report and inflation data, which remain critical indicators for the Federal Reserve’s interest rate trajectory.