Global Markets React to AI Deals and Earnings

The U.S. market is being driven by AI-related stocks, with Amazon and Nvidia seeing significant gains. Amazon signed a $38 billion deal with OpenAI to provide infrastructure support, while Nvidia benefited from Microsoft being granted a license to export its AI chips to the UAE. Despite the overall market rise, more than 300 stocks in the S&P 500 ended the day lower, indicating a narrow segment of the market is performing well. Other news includes Starbucks entering a joint venture with Boyu Capital to run its Chinese outlets, Saudi Aramco posting higher profits, and Palantir's third-quarter results beating estimates but seeing a share price drop in extended trading.

European stocks opened lower on Tuesday, reversing the positive sentiment seen at the start of the new trading month. The Stoxx 600 index fell 1.1%, with major European indices such as the FTSE, DAX, and CAC 40 also declining. Investors are awaiting key earnings releases, including BP, Philips, and Ferrari, as well as central bank decisions later in the week. The negative sentiment comes despite a positive day for US stocks on Monday, driven by enthusiasm around the artificial intelligence trade and a major deal between Amazon and OpenAI.

Asia-Pacific markets traded mixed on Tuesday, with South Korea's Kospi snapping a four-session winning streak due to a 1.29% fall, despite gains in Japan's Nikkei 225 and Hong Kong's Hang Seng index. The Kospi has gained in 12 of the past 15 sessions, driven by global AI tailwinds and local structural changes. The Reserve Bank of Australia's policy decision was a key focus for investors. Amazon's $38 billion deal with OpenAI boosted tech stocks, including Nvidia, which also gained export clearance for shipments to the UAE. South Korea announced plans to triple AI spending in 2026 to become one of the world's top three AI powers.