Volatility is on the rise again in global markets. The VIX, known as Wall Street’s fear index, climbed to its highest level in four months on Tuesday, increasing investor concerns. The reasons: AI enthusiasm, US-China trade tensions, and the start of earnings season.
Broadcom’s shares rose 10% after its partnership with OpenAI, while chip giants like Nvidia and Micron also benefited from this momentum. However, the renewed escalation of the trade war quickly eroded market gains. The US and China have begun imposing additional port fees on shipping companies, marking a new trade front.
US bond yields fell sharply, strengthening the dollar. The 30-year bond yield dropped to its lowest level since the trade shock in April. Simultaneously, crude oil prices fell to their lowest level since May, while gold hit a record high of $4,179 per ounce.
The volatility was also sharply felt in Asia. The Japan Nikkei index fell 2.5%, its biggest loss since April. Investors avoided risk due to uncertainty surrounding the country’s new prime minister. Google announced it will build a new AI center in India’s Andhra Pradesh state with a $15 billion data center investment. This move is intensifying competition among US tech giants in the Asian market. JPMorgan announced a $1.5 trillion investment plan for sectors that will contribute to the national security and economic resilience of the United States. On the same day, Goldman Sachs, Citigroup, and Wells Fargo also announced their third-quarter results, kicking off earnings season. Finally, US President Donald Trump announced the end of the two-year war in the Middle East. This development raised hopes for the restoration of regional stability.
