Most Asian share markets extended their recent gains on Tuesday, fueled by rising enthusiasm surrounding artificial intelligence (AI), which has drawn substantial investment into the tech sector. Concurrently, expectations for upcoming U.S. interest rate cuts have provided a significant boost to gold prices.
The rally was particularly evident on Wall Street, highlighted by Nvidia’s announcement of a staggering commitment of up to $100 billion in OpenAI, with the first delivery of data center equipment scheduled for the latter half of 2026. This news contributed to a record-setting performance for major U.S. tech stocks such as Oracle, Apple, Nvidia, and Tesla.
Chris Weston, head of research at brokerage firm Pepperstone, remarked on the current momentum in U.S. tech and AI, suggesting that any disruptive events would need to be unexpected to disrupt the ongoing positive cash flow into these sectors. He emphasized that as tech stocks continue to thrive, investors are also seeking safety in gold, which has shown robust price increases.
Gold prices recently reached a record of $3,759.02 per ounce, marking a nearly 9% rise for the month. The sharp inflow into technology stocks has revitalized chip sectors across several Asian markets, with South Korean equities up 0.5%, adding to a notable 9% increase this month. Additionally, Japan’s Nikkei index has recorded a 6.5% rise thus far in September, while Taiwan’s stock market has jumped almost 7%.
In contrast, Chinese blue-chip stocks experienced a decline of 0.8%, signaling a tapering in their liquidity-driven bull run in recent days. Overall, MSCI’s broadest index of Asia-Pacific shares outside Japan remained flat for the day but is still up 5.5% for the month.
European equity markets have lagged behind the tech surge, with EUROSTOXX 50 futures edging up by 0.1%. Similarly, FTSE futures also increased by 0.1%, while DAX futures ticked up by 0.2%. Meanwhile, both S&P 500 and Nasdaq futures showed minimal change after reaching new heights overnight.
Global equities have been buoyed by anticipatory expectations of additional interest rate cuts from the U.S. Federal Reserve, following recent reductions. Current futures imply a roughly 90% probability for another quarter-point cut in October and approximately a 75% chance of easing in December.
Despite this optimistic outlook, mixed signals have emerged from the Fed. New Governor Stephen Miran, appointed by former President Donald Trump, has advocated for aggressive rate reductions, yet three of his peers have cautioned against such moves due to inflation concerns.
Fed Chair Jerome Powell is expected to provide further insights into the Fed’s economic outlook and policy approaches later on Tuesday. Additionally, several Purchasing Managers’ Index (PMI) surveys on manufacturing will offer a clearer picture of global industry in the wake of U.S. tariffs.
Bond markets remain influenced by the expectation of lower short-term rates, even as the market braces for a surge in government and corporate debt this week. The Treasury is set to initiate sales with $69 billion in two-year notes, followed by $70 billion in five-year notes and $44 billion in seven-year bonds. Concerns regarding a potential U.S. government shutdown loom ahead of a looming September 30 funding deadline.
In currency markets, the dollar exhibited volatility, retreating after three consecutive sessions of gains. The euro was relatively stable at $1.1803 after recovering from a low of $1.1726. The dollar also dipped to 147.77 yen from a previous high of 148.37 yen. Meanwhile, Sweden’s crown held steady at 9.3497 per dollar as traders awaited the outcomes of a key central bank meeting that could result in a rate cut, with futures indicating approximately a one-in-three chance of easing.
In commodity markets, oil prices faced downward pressure, grappling with oversupply concerns despite geopolitical tensions in regions such as Russia and the Middle East. Brent crude slipped by 0.5% to $66.24 a barrel, while U.S. crude followed suit, falling 0.5% to $61.98 a barrel.
