Global markets are under pressure at the start of the new week, with investors navigating a twin threat from AI earnings anxiety and rising oil supply.
Asian markets slipped on Monday as investors braced for a pivotal earnings season in the artificial intelligence sector, with tech stocks caught in fresh turbulence.
The looming earnings season is drawing intense scrutiny, with Alphabet, Amazon, Meta and Microsoft alone committing a combined $725bn to AI investment.
South Korea’s Kospi fell 1.2 per cent on Monday, though the index remains up 90 per cent for the year despite the early session losses.
Attention is now turning to Samsung, the world’s largest memory chipmaker by sales, which is set to report its quarterly profit imminently.
Samsung is expected to record an operating profit of $56.35bn for the three months to June, according to LSEG estimates.
Despite the broader market weakness, Samsung finished the trading session 10 per cent higher as investors positioned themselves ahead of the earnings announcement.
Japan’s Nikkei also suffered on Monday, tumbling 1.4 per cent as the regional tech selloff deepened across major Asian indices.
On the commodities front, OPEC+ agreed to hike output targets to 188,000 barrels per day from August, following increases already implemented in June and July.
The production increase pushed Brent crude 0.5 per cent lower to $71.19 per barrel, marking a four-month low for the international oil benchmark.
Relief in the oil market has continued despite a lack of new developments in the fragile US-Iran peace agreement, helping ease inflationary pressures on global economies.
Shipping activity through the Strait of Hormuz has also resumed, with 160 vessels crossing the narrow waterway between Monday and Saturday last week.
The Strait of Hormuz had previously transported a fifth of global oil supply before the outbreak of war in February brought transit to a halt.
Among other key stories this morning, EasyJet’s board has reached an agreement over a £5.2bn takeover bid from Castlelake, while HMRC has clawed back £1m by cutting ties with outside tech suppliers.