Stocks Advance as AI Strains Ease, Dollar Slips: Markets Wrap
(Bloomberg) — A rally in technology shares that lifted Wall Street benchmarks extended into Asia, as concern over the disruptive effects of artificial intelligence eased after weeks of turmoil.
MSCI’s gauge for Asian equities climbed 1.4% to a record, with gauges in South Korea and Taiwan — bellwethers for AI investments — also hitting all-time highs. A rebound in the battered software stocks drove US benchmarks higher, ahead of key earnings from Nvidia Corp. European shares were also set for gains at the open.
The dollar fell 0.2% and US equity-index futures trimmed most of their gains after President Donald Trump delivered his State of the Union address. Treasuries edged lower, with the yield on the benchmark 10-year rising two basis points to 4.05%. The yuan climbed and Asian currencies strengthened to a 16-month high, supported by a weaker greenback.
The rebound in global stocks was helped by comments from Anthropic PBC, which said it plans to build partnerships — suggesting that its Claude chatbot will integrate with, rather than displace, existing businesses. The disruptive potential of the technology has roiled stocks across sectors for weeks in what’s become known as the “AI scare trade.”
“It was largely a circuit breaker in the bad news flow,” said Matthew Haupt, a portfolio manager at Wilson Asset Management. “But in reality it won’t have much of a half-life given that questions around AI disruption are still unresolved.”
Earlier this week, concerns over tariffs and geopolitics coupled with a report by Citrini Research and worries about the potential disruption caused by another tool from Anthropic were enough to send the stock market careening.
Investors had been on edge as AI-driven selloffs swept across industries including software, insurance brokerage, wealth management and cybersecurity. Sentiment steadied somewhat on Tuesday.
“It’s a relief rally after broad-based, indiscriminate selling,” said Ritesh Ganeriwal, head of investment at Syfe Pte in Singapore. “That said, we would characterize this as tactical stabilization, rather than a full reset of positioning.”
What Bloomberg Strategists say…
“For all the worries over the tech sector’s performance this year, one thing is clear: its earnings outlook is far superior to that of its peers, which will be key to drawing a line under share prices.”
—Kristine Aquino, Managing Editor, Markets Live. For the full analysis, click here.
Meanwhile, the Bloomberg Dollar Spot Index edged lower as Trump assailed the Supreme Court for striking down his global tariffs and gave no indication he would change course.
Read: Trump Offers Rose-Colored Glasses in Economic-Focused Speech
Trump said he would move ahead with restoring his broad import taxes through other authorities. He expressed confidence foreign countries would honor their trade agreements and even predicted that the US would take in so much revenue that it would “substantially replace the modern day system of income tax.”
“The suggestion that tariffs will replace income tax over time as the source of federal revenue does suggest that he could make even greater use of tariffs in future — a fear that has hurt the dollar in the past,” said Gareth Berry, a strategist at Macquarie Group Ltd.
Elsewhere, the yen fluctuated as Japan’s Prime Minister Sanae Takaichi’s government nominated two reflationist academics to join the Bank of Japan policy board on Wednesday. The nomination is likely to fuel speculation that Takaichi will be cautious about the central bank raising interest rates quickly.
In other corners of the market, gold and silver — assets that have risen this year along with stocks — gained. Bitcoin pared some its earlier gains to trade around $65,000.
Still, the main risk event in the tech sector on Wednesday will be Nvidia’s earnings.
The company is facing a high-stakes moment with its latest quarterly results, with the world waiting for fresh evidence that the AI spending boom remains on track. This week’s earnings will either “calm or exacerbate” AI fears, said David Laut at Kerux Financial.
“We won’t have all of the answers this week, but worried investors are hungry for clarity,” he said.
Corporate News:
HSBC Holdings Plc reported better-than-estimated earnings for 2025 as Europe’s largest bank closed out a year in which its market value broke through £200 billion ($270 billion) for the first time in its history. Workday shares fell 9% in extended trading, after the software company gave a full-year forecast that is weaker than expected. HP Inc. shares dropped about 6% in extended trading, after the computer company reported its first-quarter results and gave an outlook. The company said it expects its full-year results “to be closer to the low end of our range,” given rising memory prices and other factors. WiseTech Global Ltd. plans to cut about 2,000 jobs — almost 30% of its workforce — under an AI-driven revamp. Warner Bros. Discovery Inc. said a new $31-a-share buyout offer from Paramount Skydance Corp. could lead to a better deal than its existing agreement with Netflix Inc. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 6:51 a.m. London time Nasdaq 100 futures were little changed The MSCI Asia Pacific Index rose 1.4% Hong Kong’s Hang Seng rose 0.5% The Shanghai Composite rose 0.6% Euro Stoxx 50 futures rose 0.1% Currencies
The Bloomberg Dollar Spot Index fell 0.2% The euro rose 0.3% to $1.1804 The Japanese yen was little changed at 155.76 per dollar The offshore yuan rose 0.2% to 6.8652 per dollar The British pound rose 0.3% to $1.3524 Cryptocurrencies
Bitcoin rose 1.4% to $64,940.01 Ether rose 1.8% to $1,887.28 Bonds
The yield on 10-year Treasuries advanced two basis points to 4.05% Japan’s 10-year yield advanced three basis points to 2.135% Australia’s 10-year yield advanced three basis points to 4.72% Commodities
Spot gold rose 1% to $5,192.84 an ounce West Texas Intermediate crude rose 0.6% to $66 a barrel This story was produced with the assistance of Bloomberg Automation.
–With assistance from Winnie Hsu, Ruth Carson and Bernadette Toh.
©2026 Bloomberg L.P.
