By Ankur Banerjee and Johann M Cherian
July 21 (Reuters) – Global stocks rose on Tuesday as oil prices retreated from a one-month high on mediation efforts in the Middle East, and investors braced for corporate earnings that will test an AI trade that is under pressure.
Yemen's Iran-aligned Houthis said they would impose a naval blockade on Saudi Arabia, a move that could further disrupt energy supplies, amid increased attacks between the U.S. and Iran, even as efforts were being made to revive a fragile ceasefire.
A senior Iranian official told Reuters on Monday that Tehran had received a proposal from mediators for a 10-day ceasefire, intended to pave the way for a lasting agreement to end the war that began on February 28 with U.S.-Israeli attacks on Iran.
Brent crude futures eased 0.6% to $88.72 per barrel on Tuesday as investors latched on to hopes of a resolution. Brent hit a one-month high of $91.42 a barrel in the previous session. [O/R]
"It seems to suggest that this isn't a total breakdown. There are still channels for sort of talks to go on, which is great news. Just quite how successful they will be is another matter," said David Morrison, a senior market analyst at Trade Nation.
In equities, Europe's STOXX 600 rose 0.2%, while futures tracking the tech-heavy Nasdaq led gains on Wall Street with a 1.4% rise, suggesting a bounce at the opening bell later.
In Asia overnight, Japan's Nikkei finished up 3% and South Korea's volatile KOSPI ended 4.5% higher.
Trade was also in the spotlight after President Donald Trump slapped 50% tariffs on Canadian imports worth about $20 billion, in response to what the administration called discriminatory treatment of American-made items. USMCA trade negotiations are in progress, from which the United States has pointedly excluded Canada.
However, reaction in the Canadian dollar and benchmark bonds was muted, while futures tracking the Toronto stock index inched up 0.3% after the bourse closed at a 12-day low on Monday.
"I suppose there's a feeling that it's going to be watered down, and ultimately, it's certainly not going to happen to the tune of 50%," Morrison said of Trump's tariff threat.
Investor focus this week will be on earnings from companies including Alphabet and Intel to gauge the impact of the war and whether the AI trade has more room to run, given sky-high profit expectations for the second quarter.
July has been a rough month for global tech stocks, as investors fret about high valuations and whether the investment in AI infrastructure will yield tangible results. Strong earnings from Asian chip bellwethers Samsung Electronics and TSMC in recent weeks were also not enough to satisfy investors.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
