Market Commentary: Thursday 19th February

Global equities extended their technology-led rally as volatility linked to artificial intelligence eased, calming a key source of recent market anxiety.

Asian shares rose, led by a 3% surge in South Korea to a record high, with Samsung Electronics also hitting an all-time peak. US equity futures pointed higher, while Europe looked set for a flat open.

Risk appetite improved broadly, lifting Bitcoin, gold, and silver, even as US Treasuries fell for a third straight day following stronger-than-expected economic data and hawkish signals from some Federal Reserve officials. Although markets trimmed expectations for rate cuts, traders still anticipate two quarter-point reductions in 2026.

Investors appear more comfortable with AI-related risks for now, supported by reports that OpenAI could raise over $100 billion in a new funding round, though strategists caution that AI-driven volatility is likely to persist. Oil prices held gains after a sharp rally, with Brent above $70 a barrel amid geopolitical tensions involving the US and Iran. The Australian dollar strengthened on solid jobs data, while Japan’s 20-year bond sale saw weaker demand.

In corporate news, Airbus warned that engine supply issues are hampering jet deliveries, Renault forecast lower profitability amid electric vehicle investments, and Nestlé signalled improved sales growth under new leadership. Rio Tinto posted flat earnings, Air France-KLM beat expectations, and Mark Zuckerberg defended Instagram in a social media addiction trial.

It is a light news day, with US Unemployment Claims, the Philly Fed Manufacturing Index, and US Pending Home Sales as the main data releases.

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