US stock markets kicked off Friday's trading session on a positive note, buoyed by a resurgence in shares of companies linked to artificial intelligence. This upward movement provided a lift to overall investor mood, even as global markets processed a significant monetary policy shift from Japan.
AI-Led Rally on Wall Street
In early trade, the benchmark S&P 500 index advanced by 0.5%, building on gains from the previous day. Despite this rise, the index remained in negative territory for the week. The Dow Jones Industrial Average jumped 256 points, also a gain of 0.5%. Technology-heavy Nasdaq composite outperformed, climbing 0.7%, driven primarily by strength in tech shares.
Key players in the AI space, including chipmaker Nvidia, moved higher after a period of recent market volatility. In corporate news, Winnebago Industries saw its stock surge by an impressive 14% after the company reported quarterly profit and revenue that comfortably beat analyst forecasts.
However, not all news was positive. Sportswear giant Nike faced a sharp sell-off, with shares sliding more than 10%. Investors focused on the potential impact of tariffs, overshadowing what was otherwise a strong earnings report. Similarly, Deckers Outdoors, owner of Ugg and Hoka, fell over 3% amid related concerns about trade pressures.
In a significant tech deal, Oracle gained 4% after announcing it had signed agreements, along with investors Silver Lake and MGX, to form a new US joint venture for TikTok. Each investor will take a 15% stake, a move designed to allow the popular social media platform to continue its operations in the United States.
Bank of Japan's Historic Move
Across the Pacific, Asian markets generally advanced following a landmark decision by the Bank of Japan (BoJ). As widely anticipated, the Japanese central bank raised its benchmark interest rate by 0.25 percentage points to 0.75%. This marks the highest level for the key rate since 1995.
The move was well-telegraphed, leading to a calm market reception. Japan's Nikkei 225 index rose 1%. A more notable reaction was seen in the bond market, where the country's 10-year government bond yield crossed the 2% threshold for the first time since 2006.
"The Bank of Japan's decision to raise interest rates at its meeting today was clearly signaled ahead of time and therefore came as no surprise," noted Abhijit Surya, an economist at Capital Economics.
Sentiment in Asian markets was further supported by growing optimism that the US Federal Reserve might cut interest rates later this year. This followed the release of softer-than-expected US inflation data earlier in the week.
Commodities and Global Market Snapshot
European equity markets showed little movement, trading largely flat during midday sessions. In the commodities market, oil prices edged higher. US crude oil rose to $56.31 a barrel, while the global benchmark, Brent crude, moved up to $60.12.
In the digital asset space, Bitcoin climbed nearly 4% to just under $88,000, reflecting renewed risk appetite among some investors.
The day's trading highlighted a delicate balance in global finance: resilience in US tech shares against the backdrop of a major central bank beginning to normalize policy after decades of ultra-low rates. Investors will continue to monitor corporate earnings and central bank commentary for future direction.
