Global stocks rose on Wednesday as renewed enthusiasm for AI lifted markets ahead of Microsoft and Alphabet earnings. Rate decisions from the Fed, the European Central Bank and the Bank of Japan also arrive within 48 hours.
Global stocks rose on Wednesday, boosted by renewed AI enthusiasm before earnings from industry bellwethers. In Europe, financial shares weighed on the broader market and oil rallied.
AI trade faces earnings test
Alphabet and Microsoft report after the market close on Wednesday. Investors will look for evidence of returns that justify the cost of the AI build-out.
According to Reuters, XTB director Kathleen Brooks said: "These results could determine if the tech/AI rally has legs." She added that a failure to monetise investments, or a slowdown in capex spend, could have big repercussions for the AI trade.
Funding announcements from Meta, SpaceX and Broadcom this week breathed new life into the AI trade. Anthropic's filing for an initial public offering also provided support.
Markets move across regions
MSCI's All-World index rose 0.2%, and US stock futures edged up between 0.1% and 0.4%. In Asia, South Korea's Kospi surged 6% after blockbuster earnings from chipmaker SK Hynix.
Europe moved the other way. The STOXX fell 0.2%, pulled lower by declines in Banco Santander and UBS and a 12% slide in Adyen.
New Zealand surprises ahead of central bank decisions
The Reserve Bank of New Zealand kept rates at 2.75% in a narrow vote, surprising investors. The kiwi fell more than 1.2% to a session low of $0.5583.
Investors also await policy decisions from the Bank of Canada and the Fed. Expectations point to a rate rise from the Bank of Canada and no change from the Fed, though JPMorgan analysts anticipate at least two dissents from US policymakers, which could send a hawkish signal.
Oil rose after an attack on a refinery in Saudi Arabia. Brent crude futures gained 1.2% to $115.24 a barrel.
Source: Reuters via Investing.com
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