Stocks Climb as a Renewed Tech Rally Gains Traction

Renewed optimism around technology stocks rolled into Friday’s session, pushing US stock futures higher and extending the sector’s recent momentum. Smaller-cap shares also moved up, reflecting a broader shift as investors continued to diversify their market exposure beyond a handful of mega-cap leaders.

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Futures tied to the Nasdaq 100 climbed 0.4%, outperforming contracts linked to the S&P 500. The strength followed fresh records in global technology markets, with an Asia-based tech benchmark reaching an all-time high after a US semiconductor index notched a new peak a day earlier.

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While European technology shares were more muted, Morgan Stanley underscored its confidence in the region’s AI theme by lifting its price target on ASML Holding NV by 40%, highlighting the company’s central role in the artificial intelligence supply chain.

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Elsewhere in markets, oil prices stabilized after suffering their sharpest decline since June. Precious metals moved lower, with both gold and silver retreating. The US dollar traded without clear direction, while Treasury yields were largely unchanged, signaling a pause in major macro-driven moves.

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The rebound in tech stocks late in the week followed updates from Taiwan Semiconductor Manufacturing Co., whose capital spending plans and revenue outlook reignited enthusiasm for artificial intelligence-related investments.

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Those projections helped ease recent concerns that lofty valuations and uncertain returns were weighing on the sector. Looking ahead, many strategists expect a balance to form between continued tech leadership and broader market participation, supported by signs of resilience in the US economy.

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“There’s room for investors to diversify away from crowded positions,” said Geoff Yu, senior macro strategist at BNY. “That doesn’t mean the overall market has to suffer. When economic growth remains intact, a rising tide can lift multiple areas of the market, and return expectations are still constructive.”

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Early earnings results have also added to the positive tone. The first full week of the current reporting season has delivered encouraging signals, with nearly nine out of ten of the 28 companies that have reported so far beating analyst expectations. Major banks have dominated the initial wave of releases, offering insight into credit conditions, consumer health, and capital markets activity.

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As earnings season progresses, investors are expected to gain a clearer picture of the broader economic backdrop. High-profile reports scheduled for the coming week, including results from Netflix Inc., Johnson & Johnson, and 3M Co., should provide insight into consumer spending trends, healthcare demand, and industrial activity across different segments of the economy.

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“So far, the numbers suggest that consumers remain in relatively good shape, deal-making and capital markets are holding up, and earnings revisions continue to trend higher,” said Andrea Gabellone, head of global equities at KBC Global Services. “On top of that, supportive factors such as a weaker dollar are providing an additional boost.”

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Taken together, the latest market moves point to an environment where enthusiasm for AI-driven technology stocks is coexisting with a gradual broadening of gains across sectors.

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With economic growth still intact, earnings momentum holding firm, and financial conditions offering support, investors appear increasingly willing to look beyond a narrow set of winners while still maintaining confidence in the market’s overall direction.

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