European Stocks Rally as Semiconductor Selloff Weighs on Wall Street
Global equities moved in opposite directions, with European stocks gaining while sustained selling pressure in semiconductor stocks dragged Wall Street lower.
Easing geopolitical tensions drove oil lower yesterday, supporting most major regions by lowering inflation and fuel-cost expectations while pressuring energy shares.
The Euro Stoxx 50 closed 0.73% higher as travel, construction, and autos advanced, while the FTSE 100 gained 0.29% as miners and banks outweighed energy losses, stockbroking and portfolio management subsidiary of First National Bank (FNB) said in a brief.
Wall Street diverged as semiconductor selling intensified, leaving the NASDAQ down 1.07% and the S&P 500 0.51% lower, although the Dow Jones closed 0.41% higher.
Attention now shifts to the US mid-term elections. Asian trading remains mixed this morning. The Hang Seng is up 0.52% as technology services, retail and consumer shares respond to Chinese equity support measures and cheaper oil, despite concerns about AI spending.
The Nikkei 225 is closed for the Culture Day holiday but ended the previous session down 0.33%. The ASX 200 gained 0.34%, supported by lower oil prices but restrained by caution around the Reserve Bank decision.
In South Africa, the Johannesburg Stock Exchange (JSE) is set for a flat-to-softer open on Tuesday, despite prior session gains, as global futures edge lower and Asian markets trade mixed amid renewed pressure on technology shares and industrial commodities.
Tencent’s 1.33% advance offers a positive read-through for Naspers and Prosus, partly offsetting the broader regional caution. On the resources side, Australia’s mining index fell 0.26%, and weaker iron ore, steel, and copper prices may cap gains in diversified miners.
Precious metals are also under pressure, with softer gold weighing on gold miners and declines in platinum and palladium pointing to weakness in PGM counters.
The JSE closed firmly higher on Monday, with the All-Share Index rising 1.77% to 109 527 points and the Top 40 gaining 2.04% to 101 438 points.
The key driver was a sharp decline in global oil prices after signs of progress toward potential peace talks between Iran and the US eased concerns over a prolonged Middle East conflict and its inflationary impact, boosting global risk appetite.
Resources led the market higher, advancing 3.11%, supported by a strong rebound in precious metals and mining shares (+4.36%) as gold recovered from a one-year low on lower oil prices and softer US bond yields.
Industrials (+2.23%) also performed strongly, benefitting from the improved risk environment, while financials lagged with modest gains of 0.68% as investors weighed news that the US intends to revoke South Africa’s eligibility for the African Growth and Opportunity Act (AGOA), which provides tariff-free access for several South African exports.
Sentiment was also influenced by the Absa Manufacturing PMI data release, which rose to 49.6 in October from 48.7 in September, remaining in contractionary territory but signalling a gradual easing in manufacturing weakness.
Overall, positive global tailwinds from lower oil prices and a stronger gold price outweighed domestic concerns, leaving the market broadly higher and investor sentiment cautiously optimistic. Apple Tops Nvidia as AI Spending Concerns Reshape Sentiment
