Global shares edged higher, nearing a fresh record high and on track for a monthly gain. Despite underlying market swings fueled by geopolitical tensions and AI concerns, analysts point to "rock solid" global fundamentals including profit and growth cycles.
Europe's STOXX 600 rose, supported by positive earnings. However, anxieties surrounding AI spending, its potential business disruptions, and U.S.-Iran tensions have tempered sentiment this week. U.S. stock futures saw declines during early European trading.
Despite Nvidia's better-than-expected earnings and revenue forecast, its shares fell over 5% as investors sought more positive signals. Markets are also closely monitoring U.S.-Iran nuclear talks, with increased U.S. military resources deployed in the Middle East. An Omani mediator reported optimism in negotiations, but a breakthrough to avert potential U.S. strikes remains elusive.
Crude oil prices saw gains, with U.S. crude rising to $66.16 a barrel and Brent to $71.65. Spot gold shed slightly. Negotiations over Iran's nuclear program are set to resume, with any substantial progress potentially impacting the likelihood of U.S. strikes and wider conflict.
In currency markets, the dollar index remained flat. Sterling saw a slight increase after a UK election defeat for the Labour Party. The yield on benchmark U.S. 10-year notes fell. Data from Japan indicated cooling inflation and weaker factory output, complicating the Bank of Japan's policy outlook. Japanese officials are closely monitoring the yen's recent depreciation.