Trump's AI Spending Plan Lifts S&P 500 to Record

The S&P 500 reached an intraday record high on Wednesday, driven by optimism over Donald Trump's $500 billion AI infrastructure investment plan, with contributions from OpenAI and SoftBank. Chinese markets rebounded briefly after Beijing announced measures to channel at least 100 billion yuan into its stock market, though gains were later pared. Meanwhile, global markets remain cautious ahead of key rate decisions and economic data, with the yen under pressure before the Bank of Japan meeting.

Equities

The FTSE 100 ended flat on Wednesday after briefly hitting a record high earlier in the session, snapping a five-day winning streak. Declines in heavyweight copper miners Glencore and Rio Tinto, which fell 0.9% and 0.4% respectively, weighed on the index as copper prices slipped from one-month highs.

EasyJet dropped about 5% after issuing a weaker-than-expected revenue forecast for the second quarter, while Hochschild Mining tumbled 17% following disappointing fourth-quarter gold production forecasts. Trainline shares fell nearly 7% after the UK’s transport department announced plans for a new online ticket retailer.

Quilter rose 2.1% as the wealth manager reported a rise in fourth-quarter managed assets, driven by net inflows of nearly £2 billion.

On the other side of the Atlantic, the S&P 500 climbed 0.61% to an intraday record high, driven by strong earnings and enthusiasm over artificial intelligence investments. Netflix surged 9.7% after reporting record holiday-quarter subscriber numbers, enabling price increases across most service plans.

The technology sector led gains, with Nvidia and Microsoft providing the largest boosts, while Oracle shares jumped 6.8% following its inclusion in a $500 billion AI infrastructure investment plan alongside OpenAI and SoftBank. The Philadelphia Semiconductor Index rose 1.7%, reflecting optimism in chip stocks, while shares in ARM Holdings rose 15.9%.

The Dow Jones Industrial Average gained 0.30%, and the Nasdaq Composite added 1.28%, bolstered by tech and communication services. Procter & Gamble rose 1.9% after delivering strong second-quarter results driven by growing demand for household items in the US.

Ford slipped 3.8% after Barclays downgraded the stock, while Textron and Halliburton fell 3.4% and 3.6% respectively, the latter citing a soft North America outlook. Johnson & Johnson dropped 1.9%, despite reporting better-than-expected fourth-quarter results, as investors digested broader market trends.

Forex & Commodities

The US dollar traded steadily, with the dollar index flat at 108.31 following two days of modest gains. Earlier in the week, the dollar had dropped 1.2%—its steepest fall since November 2023—after President Trump refrained from announcing immediate tariffs. The Japanese yen slipped 0.1% to 156.69, with markets pricing in a likely 0.25% rate hike from the Bank of Japan on Friday. Meanwhile, the euro remained steady at $1.0406, ahead of the European Central Bank’s rate decision next week, where a 0.25% cut is widely expected. The Canadian dollar and Mexican peso were largely unchanged, trading at C$1.4389 and 20.49 per dollar, respectively.

Gold prices eased slightly, retreating 0.1% to $2,752.76 per ounce after hitting a near three-month high of $2,763.43 on Wednesday. US gold futures slipped 0.4% to $2,761. Analysts cited profit-taking as the dollar regained strength. While gold remains underpinned by uncertainty over President Trump’s tariff plans, resistance near $2,759 could trigger further corrections.

Oil prices fell for a sixth consecutive session, with Brent crude down 0.5% to $78.62 a barrel and WTI dropping 0.5% to $75.05. Uncertainty surrounding Trump’s energy and trade policies, along with expectations of increased US oil production, weighed on prices. US crude inventories rose by 958,000 barrels last week, alongside increases in gasoline and distillate stocks. Trump’s declaration of a national energy emergency has added to market volatility, raising concerns about higher US supplies.