U.S., European Stocks Rally, AI Demand Drive Global Risk Appetite
U.S. and European equities market gained momentum as AI, technology stocks continue to drive global risk appetite, outweighing caution around US Treasury yields that are sitting near multi-decade highs.
Mega-cap gains lifted the NASDAQ 1.05% to a record close, while the S&P 500 closed 0.66% higher and the Dow Jones added 0.18%. Lower oil prices provided further support by easing inflation and interest-rate concerns.
Europe advanced more modestly and unevenly, as strength in Spanish equities and banks offset French fiscal and political uncertainty. The FTSE 100 closed up 0.34%, supported by financials, energy, and miners, while the Euro Stoxx 50 edged 0.06% higher.
Against that backdrop, technology strength carried into Asia-Pacific trading, with semiconductor momentum providing an additional tailwind. The Hang Seng Index is currently up 0.78%, and the Nikkei 225 is trading 0.83% higher.
Australia’s ASX 200 is trading 0.57% firmer, as a strong performance among commodity counters helped to outweigh weaker consumer confidence and rising yields.
Local equities softened on Monday, with the broader All Share Index slipping a marginal 0.05% to 108 326 and the Top 40 edging down 0.10% to 100 681, as weakness in Financials (-0.66%) and a soft domestic activity reading offset a solid showing from Industrials (+0.62%).
The financial sector was weighed down by a broad risk-off tone as European sovereign debt fears, particularly policy gridlock in France, pushed developed-market bond yields higher and lifted the dollar, pressuring emerging-market assets broadly.
The insurance sub-sector was a notable exception, with Santam surging 19% after Sanlam announced a R20.7 billion cash offer to acquire the remaining ~37% of Santam it does not already own.
Resources (-0.27%) underperformed, as Precious Metals (-0.67%) came under pressure from a stronger dollar, even as gold found some safe-haven support from European debt concerns.
On the macro front, South Africa’s September S&P Global PMI fell to 49.0 from 50.5 in August, its lowest reading since December 2025, with new orders dropping sharply to 46.5 from 50.3, signalling a renewed contraction in private-sector activity that added to the cautious tone.
South African sovereign yields also shifted higher across the curve, reflecting both the global bond selloff and domestic risk sentiment.
The JSE is set for a firmer open this morning as modest gains in global futures combine with an advancing Asian session, although elevated US yields and a strong dollar temper the risk appetite.
Hong Kong technology strength is offering a useful lead, with Tencent up 1.13%, providing a positive read-through for Naspers and Prosus. Resource counters should also draw support from the S&P/ASX 300 Metals and Mining Index, which has gained 0.91%, alongside firmer Brent crude.
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