Stocks Rise as Alibaba’s AI Spending Lifts Tech: Markets Wrap

(Bloomberg) — US stocks are set to resume their rally after a pledge by Alibaba Group Holding Ltd. to step up spending reinforced optimism over artificial intelligence.

Nasdaq 100 futures rose 0.2% after big tech’s slide in the prior session broke a streak of record highs. Alibaba jumped 9% in typhoon-hit Hong Kong on plans to boost AI outlays beyond an initial $50 billion target. All members of the Magnificent Seven advanced. Contracts for the S&P 500 posted small gains.

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The dollar recovered 0.4% after back-to-back losses. US Treasury yields climbed across the curve as Secretary Scott Bessent told Fox Business he was surprised Federal Reserve Chair Jerome Powell hasn’t signaled year-end rate cuts of at least 100 to 150 basis points.

Bullishness over AI’s vast potential has fueled multiple all-time highs in stocks this year, offsetting worries about geopolitical risks and trade tensions. Prospects for Fed policy easing have added to the buoyant mood, as investors bet that lower interest rates and a resilient economy will lift corporate earnings.

“AI is back as the key driver for global markets. Investment continues apace and that’s keeping the AI theme relevant,” said Guy Miller, chief strategist at Zurich Insurance Co. “That leads to the question, is this getting to the last innings with overinvestment and misallocation of capital? From an investor perspective, all that actually tells you there’s a bit further to run.”

The S&P 500 has gone 107 sessions without a drop of 2% or more, the longest streak in more than a year. Traders are paying little attention to a range of risks, with the threat emphasized Tuesday when Powell warned that policymakers still face a difficult path ahead.

The danger now is that officials scale back expectations for further cuts, leaving Wall Street disappointed. San Francisco Fed President Mary Daly speaks later Wednesday, in what is otherwise a light day for the events calendar.

“There’s going to be lots of chatter about the Fed and that’s going to dominate,” said Daniel Murray, deputy chief investment officer at EFG Asset Management. “I expect we’re going to drift for a couple of weeks. The next catalyst is going to be the third-quarter earnings season.”

Argentine bonds trimmed losses following an announcement that the US is discussing a $20 billion swap line and is ready to buy the South American nation’s dollar debt.

In the Middle East, Saudi Arabia’s move to ease foreign ownership rules added $123 billion to the country’s stock market. Banking stocks on the Tadawul All Share Index surged a record 9%.

Oil extended its biggest gain in a week, as Trump ramped up his rhetoric against Russia and traders watched for supply disruptions from the OPEC+ member. Brent rose above $68 a barrel.

Corporate News:

Oracle Corp. is seeking to borrow $15 billion from the US investment-grade bond market on Wednesday, according to people familiar with the matter. Some Tricolor Holdings asset-backed bond holders who received interest payments last week have seen those funds clawed back in recent days, according to people with knowledge of the matter. Abu Dhabi National Oil Co.’s nearly €12 billion ($14.1 billion) takeover of Covestro AG is edging closer to European Union approval after talks with regulators paved the way for a package of commitments to be submitted as soon as next week, according to people familiar with the matter. Gerresheimer AG, a German maker of packaging for medicines, plunged the most ever after the country’s markets regulator initiated an audit of its accounts on suspicion of irregularities. A consortium including Dutch pension manager APG is investing €9.5 billion ($11.2 billion) into Tennet Holding BV’s German power grid in exchange for a 46% stake. Micron Technology Inc., the largest US maker of computer memory chips, gave an upbeat forecast for the current quarter, helped by demand for artificial intelligence equipment. Zijin Gold International Co. delayed its $3.2 billion listing after Super Typhoon Ragasa slammed Hong Kong. Tether Holdings SA, issuer of the world’s largest stablecoin, is in talks with investors to raise as much as $20 billion. Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.2% as of 8:29 a.m. New York time Nasdaq 100 futures rose 0.2% Futures on the Dow Jones Industrial Average were little changed The Stoxx Europe 600 fell 0.3% The MSCI World Index fell 0.1% Currencies

The Bloomberg Dollar Spot Index rose 0.4% The euro fell 0.5% to $1.1752 The British pound fell 0.4% to $1.3466 The Japanese yen fell 0.6% to 148.52 per dollar Cryptocurrencies

Bitcoin rose 0.9% to $113,044.86 Ether was little changed at $4,179.16 Bonds

The yield on 10-year Treasuries advanced three basis points to 4.13% Germany’s 10-year yield was little changed at 2.75% Britain’s 10-year yield was little changed at 4.69% Commodities

West Texas Intermediate crude rose 1.3% to $64.22 a barrel Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.

–With assistance from Sujata Rao.

©2025 Bloomberg L.P.