Tech stocks on both sides of the Atlantic were broadly stronger as the US$500 billion partnership to invest in building artificial intelligence infrastructure in the US spurred on the rally in equities markets.
The Nasdaq was up 1.5% at 7am in afternoon trading, while Germany’s DAX 30 gained 1% and France’s CAC 40 rose 0.9% as investors continue to work through the rapid pace of announcements coming from the new Donald Trump administration in the US.
The S&P 500 was up 0.8% and on track to close at a record, while the UK’s FTSE 100 edged lower from a record during the session. JPMorgan Chase chief Jamie Dimon told CNBC that US equities have risen too fast and that good outcomes are needed to justify those pries.
Oracle and SoftBank surged in their respective markets, while Nvidia, Microsoft and Arm Holdings were among tech stocks on the rise after the AI-infrastructure Stargate joint venture was unveiled. However, Tesla chief and Trump’s government efficiency tsar Elon Musk questioned the ability of SoftBank and OpenAI don’t have the money to pay their share.
The return of Trump to the White House has whipped around currency markets with mixed messaging on when the US might impose steep tariffs on Canada, Mexico and China, and gold futures prices rose 0.4% to US$2,770 an ounce.
“Any mention by Trump on tariffs gets the attention of the market, but the blip in currencies proved short lived,” Bank of New Zealand senior markets strategist Jason Wong said in a note. “Trump’s ‘America First Trade Policy’ focuses on 1 April as a key date for the conclusion of the various trade reviews and consultation reports to be delivered to President Trump, so all this chatter could continue for another couple of months without any concrete action.”
The kiwi dollar traded at 56.67 US cents at 7am in Auckland from 56.56 cents.
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The latest earnings continued to divide investors. Healthcare company Johnson & Johnson beat expectations but its forecast for annual sales disappointed investors, while Procter & Gamble rallied when its earnings came in ahead of analysts’ predictions, with growing demand in the US and a revival in Chinese demand.
UK airline Easyjet tumbled after flagging weaker-than-expected revenue forecast, while Puma plans to cut costs after posting a decline in profit.
Meanwhile, insurer Travelers beat expectations and was confident in its 2025 outlook, despite expected losses from the Los Angeles wildfires, and reinsurer Munich Re rallied after a record year while saying it was still too soon to put a figure on the burden of the Californian disaster. The wildfires are expected to drive up reinsurance costs with Australia's IAG, Suncorp and QBE more at risk than New Zealand's Tower given the different risk profiles, according to Forsyth Barr analysts.
The Northern Hemisphere stock rally might not extend to the antipodes, with Australian’s futures pointing to a 0.1% decline on the S&P/ASX 200 index today. Still, New Zealand’s S&P/NZX 50 index has sat out much of the recent rally, sliding for the past three days.
Local data today include travel and migration figures for November, while a speech from Prime Minister Christopher Luxon is expected to outline the administration’s plans to attract foreign investment.
Meanwhile, the Australian Financial Review’s Street Talk column reports Australian Retirement Trust is in talks to sell its minority stake in local lines company Powerco.