Stocks Rise as Trump’s AI Plan Offsets Tariff Risk: Markets Wrap

(Bloomberg) — Europe’s stock benchmark edged closer to a record high and US equity futures gained as optimism over more artificial intelligence spending under Donald Trump offset uncertainties over looming tariffs.

The Stoxx Europe 600 climbed 0.3%, leaving it less than one index point shy of September’s record. Futures on the S&P 500 and Nasdaq 100 signaled that the strong Wall Street rally of the past two sessions remains on track. The gains followed advances in Asian tech shares in the wake of Trump’s plan for an investment push in the AI sector. Chinese shares, however, fell after the US president said he was still considering a 10% tariff on all goods from the country.

The divergent forces driving global financial markets underscore the difficult questions investors will be forced to weigh up over the coming months, when the Trump administration is expected to continue with its sweeping policy overhaul. His first two days in office have largely been supportive of sentiment, as investors zeroed in on his pro-business policies immediate tariff risks receded.

“I still see the path of least resistance, albeit a choppy one, leading higher on Wall Street,” said Michael Brown, a senior research strategist at Pepperstone Group Ltd. “The incoming administration has an incentive to keep the market buoyant, given how the performance of the Dow tends to be Trump’s personal yardstick of his own success, with solid economic and strong earnings growth likely ensuring that the rally remains intact.”

Health care and technology stocks were among the biggest gainers in Europe, while miners underperformed as iron ore and industrial metals declined amid concern about the impact of tariffs on China’s economy.

US 10-year Treasury yields were steady after falling five basis points in the previous session. The dollar strengthened against every Group-of-10 peer, while the onshore and offshore versions of the Chinese yuan were among the worst performers in Asia’s currency market.

The decline in Chinese shares surprised some market participants. The country was spared the brunt of Trump’s early policy flurry, with his first big tariff comments instead targeting Canada and Mexico. 

“We are seeing quite a broad-based pull back today which is a surprise to me,” said Nigel Peh, a portfolio manager at Timefolio Asset Management Co. “I feel the 10% tariffs against China — a more gradual approach — are actually better than feared. There’s a chance that people are just using any excuse to take profit.”

Chinese Vice Premier Ding Xuexiang told the annual World Economic Forum in Davos, Switzerland, that his nation will expand its imports “to promote balanced trade.” 

SoftBank Group’s shares rose more than 10% after Trump named the company as a participant in the ‘Stargate’ AI joint venture. The move pushed the Japanese company’s shares to their highest level since July, and helped boost sentiment for other tech stocks.

But China and Hong Kong tech stocks were largely left out of the rally. The Hang Seng Tech index, which includes some of China’s biggest tech firms, fell as much as 2.8%. 

In commodities, oil pushed lower. Gold held near the highest since early November.

Key events this week:

• US Conference Board leading index, Wednesday
• Samsung Galaxy “Unpacked 2025” event, expected to reveal new flagship phone models, Wednesday
• Eurozone consumer confidence, Thursday
• US jobless claims, Thursday
• Bank of Japan policy meeting, Friday
• Eurozone HCOB Manufacturing & Services PMI, Friday
• US University of Michigan consumer sentiment, existing home sales, S&P Global Manufacturing & Services PMI, Friday

Some of the main moves in markets:

Stocks

• The Stoxx Europe 600 rose 0.3% as of 8:07 a.m. London time
• S&P 500 futures rose 0.3%
• Nasdaq 100 futures rose 0.7%
• Futures on the Dow Jones Industrial Average were little changed
• The MSCI Asia Pacific Index was little changed
• The MSCI Emerging Markets Index fell 0.2%

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro fell 0.1% to $1.0413
• The Japanese yen fell 0.3% to 156.00 per dollar
• The offshore yuan fell 0.2% to 7.2853 per dollar
• The British pound fell 0.2% to $1.2322

Cryptocurrencies

• Bitcoin fell 1.7% to $104,965.26
• Ether fell 1.4% to $3,287.5

Bonds

• The yield on 10-year Treasuries was little changed at 4.58%
• Germany’s 10-year yield was little changed at 2.51%
• Britain’s 10-year yield was little changed at 4.60%

Commodities

• Brent crude fell 0.4% to $79.01 a barrel
• Spot gold rose 0.2% to $2,749.25 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Abhishek Vishnoi.

©2025 Bloomberg L.P.