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[B]Date: 21st October 2026.[/B]

 

[B]Tech Earnings Ease AI Fears, Asian Stocks Rally.[/B]

 

 

Strong tech earnings are giving the AI trade a much-needed lift. Asian stocks climbed on Wednesday after better-than-expected results from SpaceX and Super Micro Computer, with Korean shares rallying as much as 4%, Japan’s Nikkei up 1.3% and Taiwan’s Taiex gaining 1.2%. Nasdaq 100 futures rose 0.8%, and European shares were set to open higher.

 

The bigger test comes later today, when Meta and Tesla report. Meanwhile, Brent is holding above $110, Australia’s central bank has turned more hawkish, and a cluster of central bank decisions next week will keep rate expectations in focus. Here is what traders need to know.

 

AI trade: earnings beats bring relief

Results are helping to calm the AI anxiety that drove last week’s sell-off. SpaceX rose 8.1% in extended trading after its numbers, while Super Micro Computer jumped 16%. The MSCI Asia Pacific Index gained 1%, ending a two-day losing streak.

 

Wall Street also ended Tuesday on a positive note, with the S&P 500 up 0.3% as oil prices and Treasury yields eased. Early results this season have helped steady sentiment, though investors remain selective after last week’s sell-off.

 

AI infrastructure stocks remain volatile. Elice surged 30% in Seoul, recovering part of its record-breaking IPO slump, but Australian data-centre developer NEXTDC plunged 40% after cutting its outlook.

 

Not everyone is convinced. Billionaires Ken Griffin and Ray Dalio have both recently warned that AI has the hallmarks of a bubble. Edward Jones’ Angelo Kourkafas takes a more balanced view, arguing that demand isn’t slowing. In his view, investors are simply becoming more selective, favouring companies with the strongest finances.

 

Corporate highlights

• SpaceX and Tesla: Elon Musk said both companies have formed special committees to explore a potential merger, which would be the largest corporate tie-up ever.
• Netflix: The company posted its slowest revenue growth in three years and guided for a fourth straight quarter of slowing growth.
• CATL: Shares fell after third-quarter profit growth missed estimates.
• Nvidia: The chipmaker is reportedly in talks to invest hundreds of millions of dollars in Australian AI cloud firm Firmus Grid.
• DayOne Data Centers: The company is weighing a delay or a smaller size for its US IPO.

Oil: Brent holds above $110

Brent rose 1.1% to around $110.03 a barrel after touching a five-month high in a volatile session on Tuesday. Prices briefly dipped on unconfirmed reports of renewed peace talks, then recovered after the reports were denied.

 

 

Traders are balancing diplomacy against supply risks. On the diplomacy side, the Iranian president met Pakistan’s army chief, a key mediator between the US and Iran. On the risk side, Houthi attacks on Saudi infrastructure and reported vessel attacks in the Gulf continue, and US industry data showed another drop in crude stockpiles.

 

On Ukraine, US envoy Steve Witkoff is due to meet Russian President Vladimir Putin today, following talks with Ukrainian President Volodymyr Zelenskiy in Norway that a US official described as constructive.

 

Central banks: RBA turns hawkish, Fed hold expected

RBA. RBA Deputy Governor Andrew Hauser said the inflation outlook looks materially worse, partly due to high oil prices, and that he is unsure whether rates will need to rise again in November. Markets now see roughly a 50% chance of a hike to 4.85% at the 2–3 November meeting, up from 30% at the start of the week. Goldman Sachs now expects a hike. AUD/USD hovered near a three-week high at 0.7013. Australia’s Q3 CPI, due next week, is forecast to show headline inflation at 4.0%.

 

 

Fed. A Reuters poll shows most economists expect the Fed to hold on 28 October before hiking in December. CME FedWatch prices an 83% chance of a hold. The US 10-year yield edged up 1 basis point to 5.12%.

 

BoJ. Economists also expect the Bank of Japan to hold on 30 October, with a 25bp hike in December followed by quarterly increases. USD/JPY rose 0.1% to 158.33 after Japan’s September exports grew 16.7% year on year, below estimates but supported by strong chip and AI-related demand.

 

Next week’s lineup. The Fed, ECB and BoJ announce decisions on consecutive days from Wednesday 28 October. The Reserve Bank of New Zealand and the Bank of Canada also decide on 28 October, with markets betting on 25bp hikes from both.

 

FX and bonds: dollar near three-week low, French risk persists

The dollar index held at 101.78 after hitting a three-week low on Tuesday, as lower yields and oil prices reduced its appeal. CBA’s Carol Kong noted that tech earnings could have a big impact on the dollar, given how closely global sentiment is tied to the sector.

 

• EUR/USD: steady at 1.1229
• GBP/USD: 1.33735
• NZD/USD: −0.1% to 0.5677
• USD/CAD: steady at 1.4064

France remains the euro’s main risk. Prime Minister Sébastien Lecornu said troops will reinforce police ahead of protests planned for Saturday. French stocks fell, and the 10-year OAT yield rose 2.7 basis points to 4.94%. That widened its spread over German Bunds to 153.1 basis points.

 

Emerging markets. Traders are awaiting Bank Indonesia’s decision today, as the central bank tries to halt the rupiah’s slide following the MSCI-triggered market rout.

 

Gold and crypto

Gold traded near $4,120 an ounce, holding onto losses of more than 1% since the start of the week. Bitcoin rose 0.3% to about $82,989, and Ether gained 0.2% to roughly $2,453.

 

Three things to keep in mind:

• Meta is today’s market mover. Its AI spending guidance could swing the Nasdaq 100 and Asian chip stocks, so expect volatility after the US close.
• AUD is in play. A hawkish RBA and next week’s CPI make AUD/USD sensitive to any inflation surprise.
• Central bank week is approaching. Five major decisions in three days mean positioning could shift quickly. Review position sizes and stop-loss levels.

[B]Always trade with strict risk management. Your capital is the single most important aspect of your trading business.[/B]

 

[B]Please note that times displayed based on local time zone and are from time of writing this report.[/B]

 

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[B]Andria Pichidi

HFMarkets[/B]

 

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