Global stocks climbed on Tuesday, driven by growing excitement around artificial intelligence (AI), which is attracting a lot of money into technology companies. Expectations that the US Federal Reserve will continue cutting interest rates also pushed the price of gold to a new record high.
European stocks, which have typically been slower to follow the tech stock trend, saw gains of 0.4% in the EURO STOXX 600 index. This was primarily boosted by utility companies, with both German and French stock indexes climbing 0.5% and 0.7% respectively.
However, the Dutch chip equipment manufacturer ASML saw its shares drop by 1.2%, which kept the overall gains in check.
On the FX front, The S dollar held steady on Tuesday as investors carefully considered recent comments from members of the Federal Reserve.
These remarks were seen as having a “hawkish” tilt, which means they suggest a preference for tighter monetary policy, like higher interest rates, to control inflation. At the same time, the market was waiting for a speech from Fed Chair Jerome Powell for more clarity on the economic outlook.
The dollar’s value shifted throughout the day but ended up mostly unchanged. The U.S. Dollar Index, which measures the dollar against other major currencies, was last at 97.36, after its three-day winning streak was broken on Monday.
The euro and the British pound were slightly lower and flat against the dollar, respectively. The dollar was also flat against the Japanese yen.
However, it gained slightly against the Swedish krona after Sweden’s central bank cut its key interest rate to 1.75% and indicated that rates would likely stay at that level for a while.
The offshore Chinese yuan remained unchanged against the dollar. This was because some major state-owned banks were reportedly buying US dollars. This move is typically seen as an effort to slow down the yuan’s appreciation, or strengthening, against the dollar.
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