Global equities rally near 15% year-to-date gains as geopolitical and AI bubble concerns fade, compressing risk premia.
Global equities surged as risk premia compressed, driven by reduced fears over the Iran conflict and a fading AI bubble rather than upgraded growth expectations. The S&P 500 closed at a record high, marking its strongest session since April, while Asian markets and futures followed suit.
The rally pushed year-to-date returns close to 15%, with technology leading gains at over 3%. Energy was the sole sector to finish lower, reflecting a selective rather than indiscriminate risk-on move. Prior sessions had seen muted activity amid elevated geopolitical tensions and valuation concerns.
Markets opened firmer in Asia, with US and European futures also higher, extending the positive momentum from the previous session.