Stocks Advance as Chip Rally Builds, Brent Climbs: Markets Wrap
(Bloomberg) — Chip stocks extended a global rally as investors renewed bets that the artificial intelligence trade has further room to run. Oil climbed on pessimism over US-Iran peace talks.
MSCI’s Asia Pacific equities gauge rose 1%, extending Tuesday’s biggest one-day gain in a month. South Korea’s Kospi, a bellwether for AI investments, jumped 4% as the unwinding of leveraged bets that drove the benchmark nearly 30% below its peak appeared to be nearing an end. Chip bellwethers Samsung Electronics Co. and SK Hynix Inc. led gains.
The rally in Asia followed a more than 5% jump in a US semiconductor gauge on Tuesday, rebounding from bear market territory last week, as investors awaited Alphabet Inc.’s guidance on AI spending. Even so, caution prevailed, with Nasdaq 100 futures falling 0.4%, S&P 500 contracts edging lower and European shares set for a tepid open.
The rise in crude oil prices this week is reigniting inflation concerns, and pushed Treasury yields to their highest level in two months on Tuesday. Brent climbed 1.4% to $92.25 a barrel after US President Donald Trump minimized the prospect of immediate talks with Iran. Gold gained as much as 1.6% to about $4,142 an ounce — the highest level in two weeks — as dip buyers supported prices despite escalating Middle East tensions.
The rally in technology stocks follows weeks of volatility in the year’s best-performing corner of the market as investors questioned whether massive AI spending will translate into commensurate returns. The focus now shifts to earnings from Alphabet and Tesla Inc. beginning Wednesday, with lofty expectations leaving little room for disappointment.
“The burden of proof has changed. Investors are no longer asking whether companies can withstand the uncertainty,” said Bret Kenwell, an analyst at eToro. “They want growth and guidance strong enough to justify elevated valuations.”
Concerns about expensive valuations drove a selloff in chip stocks earlier this month, pushing the Philadelphia Semiconductor Index briefly into a bear market last week. The gauge has gained two days in a row since then, while a chip benchmark in Asia jumped more than 2.4% on Wednesday.
What Bloomberg Strategists Say…
“Bullion is extending gains despite a surge in crude as the US-Iran conflict drags on, flipping the script that played out back in March when higher oil prices sent the dollar and real yields higher, proving toxic for the metal. Central banks keep adding gold to reserves and investors may be returning to the precious metal as a diversification play.”
— Garfield Reynolds, MLIV Asia Team Leader. For full analysis, click here.
Other precious metals also gained. Silver climbed 1.5% to about $59.60 an ounce, while platinum also advanced.
The yen was little changed in Asian trade after sliding past 163 per dollar on Tuesday for the first time since 1986, testing Japanese authorities’ resolve to intervene. Two senior Japanese officials warned that authorities are ready to take action in the currency market if necessary.
Treasuries held Tuesday’s losses, which pushed 10- and 30-year yields to the highest levels in about two months. The surge in oil prices has rekindled concerns that inflationary pressures will prompt the Federal Reserve to raise interest rates.
The market is learning to live with higher oil prices, but “the big question is, for how long?” Tim Waterer, chief market analyst at KCM Trade in Sydney, wrote in a note. “Right now, solid earnings are coming to the rescue and are helping divert market focus away from the fact that oil prices are advancing.”
Attention is also on pharmaceutical companies after Trump announced plans to impose 100% tariffs on generic drugs imported to the US, beginning in August 2028. Indian pharma stocks slipped.
That said, investors remain focused on company results. US earnings growth should continue to support stocks in the second half of the year, even as near-term bullish positioning and macro headwinds weigh on share prices, according to Goldman Sachs Group Inc. strategists.
Nearly 20% of companies in the S&P 500 by market value are slated to report results this week. Alphabet and Intel will give investors a clearer read on how AI spending is reshaping the tech industry. Intel reports Thursday.
While the recent selloff in AI-related shares has raised questions about the durability of the trade, some strategists see it as a reset rather than a sign of deteriorating fundamentals.
“The long-term AI backdrop appears to be intact,” said Adam Turnquist at LPL Financial. “The recent correction appears more consistent with a healthy reset following a parabolic advance than a fundamental breakdown in the AI investment theme.”
Corporate News:
Super Micro Computer Inc. shares rose about 15% in extended trading after the server maker issued preliminary results saying its backlog hit a record on new orders in the quarter of more than $60 billion. SpaceX has set the stage for one of the largest share unlocks in capital markets history, with as much as $116 billion worth of stock becoming eligible for sale for the first time next month. Cathay Pacific Airways Ltd. expects a jump in first-half net income, driven by strong passenger and cargo demand. Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.1% as of 1:52 p.m. Tokyo time Japan’s Topix rose 1% Australia’s S&P/ASX 200 rose 0.3% Hong Kong’s Hang Seng fell 0.8% The Shanghai Composite rose 0.5% Euro Stoxx 50 futures rose 0.1% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1408 The Japanese yen was unchanged at 163.17 per dollar The offshore yuan was little changed at 6.7746 per dollar Cryptocurrencies
Bitcoin was little changed at $66,343.2 Ether rose 0.7% to $1,935.63 Bonds
The yield on 10-year Treasuries was little changed at 4.63% Japan’s 10-year yield advanced three basis points to 2.750% Australia’s 10-year yield advanced three basis points to 4.98% Commodities
West Texas Intermediate crude rose 1.3% to $85.41 a barrel Spot gold rose 1.2% to $4,125.58 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Yihui Xie.
©2026 Bloomberg L.P.
