NEW YORK/LONDON, Feb 25 (Reuters) - Global shares were higher on Wednesday, helped by a rally in technology stocks and with markets awaiting Nvidia's earnings report.
Investor concerns around U.S. tariffs appear to be taking a back seat while worries about the impact of artificial intelligence are easing.
On Wall Street, all three indexes were higher on the day with technology and financial stocks driving gains. The Dow Jones Industrial Average (.DJI), rose 0.43%, the S&P 500 (.SPX), rose 0.60%, and the Nasdaq Composite (.IXIC), rose 0.96%.
MSCI's world share index was up 0.78% (.MIWD00000PUS), with Europe's broad STOXX 600 (.STOXX), 0.69% higher after hitting a record high.
Software stocks posted gains in the U.S. and Europe on Tuesday when AI lab Anthropic announced several new plug-ins developed jointly with partners.
"AI is the dominant theme and what's moving the market more than anything right now," said Aaron Schaechterle, portfolio manager at Janus Henderson Investors in Denver.
"On the positive side of the AI theme, there's capital expenditure spending on data centers and power and we don't see that ending soon. The second theme in AI is the displacement threat to established software companies."
"Ultimately, when you look at what we are debating about these stocks, it's not what will happen next quarter but what could happen five or six years from now," Schaechterle said.
The recent rebound in tech stocks could be reinforced or challenged by results from Nvidia (NVDA.O), the world's largest company by market capitalization, due after the U.S. market close.
Forecasts are for its profits to have risen 62% in the quarter to the end of January, and revenue to have jumped 68%, although with Nvidia having outpaced sales forecasts for 13 straight quarters the market is likely to be expecting more.
It is not only tech stocks driving growth, however. Shares in HSBC (HSBA.L), Europe's largest bank, were up 5.3% in London after it reported profit that beat expectations, and lifted a key earnings target.
POLITICAL AND GEOPOLITICAL WORRIES
The optimism in equities comes even as investors grapple with a range of political and geopolitical worries, though it did allow U.S. President Donald Trump to boast of stock market gains in his State of the Union speech.
Trump also said "almost all" countries and corporations want to stick to tariff and investment agreements previously made with Washington, but he did not offer clarity regarding his plans for Iran amid signs he is inching closer to a military conflict.
The worries about AI, Iran and tariffs have helped support government bonds in the U.S. and particularly Europe in recent days, although yields were slightly higher on Wednesday.
The yield on benchmark U.S. 10-year notes rose 1.3 basis points to 4.046%.
Most European 10-year government bond yields were also up. The yield on benchmark German 10-year Bunds rose 0.2 basis points to 2.71%.
Japanese yields rose sharply on Wednesday after the nomination of two academics seen as dovish to the central bank's board.
While rate-sensitive shorter-dated yields fell on expectations for less-immediate BOJ rate hikes, broader worries that the BOJ is behind the curve sent longer-dated yields higher.
In currencies, the dollar was weaker against the euro with the single currency up 0.24% at $1.18002 and the pound up 0.43% at $1.3545.
The Japanese yen weakened 0.36% against the greenback to 156.45 per dollar. Against the Swiss franc , the dollar weakened 0.12% to 0.773.
Oil prices slipped as a much larger-than-expected U.S. crude stock build outweighed the threat to oil supply from potential military conflict between the U.S. and Iran.
U.S. crude fell 0.41% to $65.37 a barrel and Brent rose 0.13% to $70.87.
Spot gold rose 1.06% to $5,202.29 an ounce.
Reporting by Chibuike Oguh in New York; Additional reporting by Niket Nishant; Editing by Chris Reese
