Tech Spending Surge Lifts Stocks as AI Buildout Accelerates – Europe Market Wrap
Equity markets pushed higher as the world’s largest technology firms doubled down on spending to expand the infrastructure behind artificial intelligence, reinforcing confidence that the AI boom still has room to run. At the same time, a softer dollar sent gold and silver to new record levels.
Nasdaq 100 futures swung into positive territory, rising 0.4%, after early losses were erased. Meta was among the first major tech names to report and set the tone by announcing plans to invest as much as $135 billion this year — far exceeding expectations closer to $110 billion. Its shares jumped 6.6% in after-hours trading after the company paired the spending surge with a stronger-than-expected revenue outlook.
Not all results landed as cleanly. Microsoft slipped after unveiling its own increase in capital spending while reporting slower growth in cloud revenue. Still, broader sentiment remained constructive, with S&P 500 futures up 0.3%. Asian equities advanced, led by South Korea’s Kospi, while European stocks edged higher as earnings rolled in across the region.
Commodity markets extended their powerful rally. Gold climbed above $5,520 an ounce, while silver pushed its gains for the year to 66%. Copper surged as much as 7.9% in London trading, and Brent crude reached its highest level since September. The moves were amplified by the dollar’s renewed weakness, which tends to lift prices for raw materials priced in the US currency.
Bond markets moved in the opposite direction. Treasuries slipped as investors weighed the risk that soaring commodity prices could feed inflation pressures just as central banks look for room to ease policy.
AI investment headlines continued to stack up. Nvidia, Microsoft and Amazon are reportedly in talks to commit as much as $60 billion to OpenAI. Tesla also said it plans to invest $2 billion into Elon Musk’s AI venture, xAI, while posting better-than-expected fourth-quarter earnings.
In currency markets, the Australian and New Zealand dollars extended their rallies, boosted by leveraged positioning and their close ties to commodity prices. The yen hovered near 153 per dollar after Treasury Secretary Scott Bessent downplayed the likelihood of coordinated US-Japan intervention. Japanese government bonds fell after early polling suggested the ruling coalition is poised to gain seats in a snap election, intensifying fiscal concerns.
The Federal Reserve kept policy steady, voting 10–2 to hold its benchmark rate in a range of 3.5% to 3.75%. Governors Christopher Waller and Stephen Miran dissented, favoring a quarter-point cut. Officials removed language that had highlighted rising downside risks to employment, while upgrading their assessment of economic momentum to say activity has been expanding at a solid pace. Inflation, however, was again described as “somewhat elevated.”
Chair Jerome Powell struck a cautiously upbeat tone, pointing to what he called a clear improvement in the outlook and signs that the labor market is stabilizing. With two remaining policy meetings before the end of his term, Powell suggested adjustments may not be urgent if current trends hold.
