WASHINGTON (July 11): Stocks rose and oil prices fell slightly on Friday as investors maintained enthusiasm around artificial intelligence (AI) and ignored the ongoing conflict between the United States and Iran.
All three major U.S. indexes ended the day higher on Friday, with the Dow Jones Industrial Average up 0.29%, the S&P 500 up 0.42% and the Nasdaq Composite Index up 0.29%.
The last time MSCI measured global stock prices, the rate of increase was 0.4%.
While fresh back-and-forth attacks have further undermined the fragile three-week-old U.S.-Iranian cease-fire, markets remain largely on board with developments in the Middle East, although investors remain focused on oil prices and the potential for subsequent inflation.
SK Hynix’s US debut
South Korean chipmaker SK Hynix hit the US market with a bang on Friday, with its US-listed shares rising 14% on its Nasdaq debut after the company raised about US$26.5 billion (RM107.9 billion). This shows a strong appetite among investors to gain exposure to AI supply chains.
The blockbuster offering will fund new factories and equipment to meet surging demand for AI chips and is set to be the world’s second-largest stock sale after SpaceX’s record-breaking IPO last month.
Oil prices took a step lower on Friday as investors awaited clarity on the fraying of the ceasefire between the US and Iran. US President Donald Trump said on Friday that the two countries would continue negotiations but that a June agreement to halt military action was “done.” The two countries have launched military operations in the Gulf in recent days that they say have reignited the conflict, disrupting global energy trade by disrupting navigation through the Strait of Hormuz.
Despite the immediate concerns, U.S. crude oil prices fell 0.74% on the day to $71.55 per barrel, while Brent crude oil fell 0.41% to $75.99 per barrel.
“Despite the conflict, oil prices have remained surprisingly stable.” [once again] “There are several factors that could prevent another surge, but this likely just reflects an underlying optimism about the ongoing talks,” Karl Campus, senior economist at BMO, said in a note.
In foreign exchange markets, attention continued to be focused on the sharp rise in the Japanese yen following remarks by Finance Minister Satsuki Katayama suggesting that repatriation may be in store for Japanese investors.
The previous price was 0.4% higher at $1 = $161.71. The fragile yen has hovered near 40-year lows in recent days as traders monitor public intervention by Tokyo.
Otherwise, the dollar was mostly lower as investors waited for a cue to see where U.S. interest rates would go. The U.S. dollar index against a basket of currencies including the yen and euro rose 0.05% to 100.96.
The yield on the benchmark 10-year U.S. Treasury note rose 2.22 basis points to 4.561%.
