US tech shares rally as AI optimism lifts equities

US equities closed higher on Tuesday, led by technology shares as enthusiasm around artificial intelligence (AI) lifted chipmakers amid the ongoing third-quarter earnings season. The Nasdaq Composite rose 1.19% to 26 479.92, while the S&P 500 gained 0.61% to 7 723.51. The Dow Jones Industrial Average edged up 0.06%. Meanwhile, oil prices eased amid renewed hopes for a diplomatic resolution to the US-Iran conflict, offering some relief on inflation concerns. Investors also turned their attention to the Federal Reserve’s two-day policy meeting, with markets largely expecting interest rates to remain unchanged. 

European equities rose for a second consecutive session, with the Euro Stoxx 50 gaining 0.80% and the Stoxx 600 advancing 0.50%, supported by mining and technology shares and lower oil prices. In contrast, the UK’s FTSE 100 fell by more than 0.50%, weighed down by HSBC, which dropped 5.40% after third-quarter profits missed expectations, and Reckitt, which declined 4.90% after lowering its sales outlook. Energy shares also weakened as crude prices eased, with Shell falling 1.70% and BP losing 2.80% amid renewed hopes of a diplomatic resolution to the US-Iran conflict. Mining shares provided some support, with Antofagasta rising 4.60% and Anglo American gaining 2.30%. Elsewhere, Porsche advanced 3.80%, supported by resilient profitability despite lower vehicle deliveries. 

Asian equities were mixed at the close of session on Tuesday, with Japan leading gains as technology and semiconductor shares benefitted from the previous session’s rally on Wall Street. The Nikkei 225 climbed 1.73% to 63 268.37, supported by demand for companies linked to AI. In contrast, Hong Kong’s Hang Seng Index fell 0.93% to 22 995.23, while the Shanghai Composite declined 0.94% to 3 662.94. Concerns about domestic demand and uncertainty surrounding the US economic outlook and Federal Reserve policy weighed on sentiment in Hong Kong and mainland China, with investors also awaiting corporate earnings and key central bank decisions. 

South African equities closed higher, with both the JSE All Share and Top 40 indices gaining 0.63% to 109 820.15 and 101 609.02, respectively. Firmer gold prices supported sentiment towards gold shares, while the South African Reserve Bank’s leading business cycle indicator rose 1.10% month on month, pointing to improving domestic economic activity. At 20h33 SAST, the rand was 0.08% stronger at R16.62 against the US dollar. 

Global commodity markets ended mixed, with precious metals gaining while oil prices declined. Brent crude fell 1.55% to $114.00 per barrel, while WTI dropped 1.76% to $99.97, as renewed diplomatic efforts to resolve the US-Iran conflict eased potential supply disruption concerns. At 20h33 SAST, gold rose 0.99% to $4 056.24 per ounce, supported by renewed buying ahead of the Federal Reserve’s policy meeting. Silver also advanced 0.56% to $54.23 per ounce.