Global markets advance on easing geopolitical tensions, AI optimism

Global markets traded higher Tuesday as reports of planned US-Iran talks in Doha eased geopolitical tensions, while optimism over returns from artificial intelligence investments lifted technology shares.

Meanwhile, the US Supreme Court ruled that Federal Reserve Board member Lisa Cook can remain in office while legal proceedings continue over President Donald Trump's attempt to remove her.

The decision eased concerns about the Federal Reserve's independence, with the benchmark US 10-year Treasury yield trading around 4.37%.

Brent crude fell 0.2% to $73.50 a barrel ahead of the Doha talks, while the US Dollar Index rose 0.2% to 101.3 and gold slipped 0.8% to $3,986 an ounce.

Persistent inflation concerns continued to support expectations that interest rates will remain elevated, boosting the dollar and weighing on gold.

Wall Street closed higher Monday, led by gains in technology shares. SpaceX shares rose 7.15% after the company announced its Nasdaq 100 debut starting July 7, while Google parent Alphabet gained 4.96% after being added to the Dow Jones Industrial Average, replacing Verizon.

Comcast shares rose 4.53% following an announcement that it plans to spin off its media and tech operations into two publicly traded firms.

The Dow Jones Industrial Average rose 0.59%, the S&P 500 gained 1.18% and the Nasdaq Composite climbed 2.07% on Monday, while US index futures pointed to a higher open Tuesday.

European markets closed lower Monday amid lingering uncertainty over the durability of the reported US-Iran agreement. However, they traded mostly in the green on Tuesday.

Meanwhile, eurozone economic sentiment improved in June, with the European Commission's economic sentiment index rising from 93.5 to 95, while consumer confidence remained at minus 17.7.

Asian markets also traded mostly higher Tuesday, taking their cue from Wall Street's gains and stronger-than-expected manufacturing data from China.

China's manufacturing Purchasing Managers' Index (PMI) rose to 50.3 in June, beating expectations and signaling stronger industrial activity, boosting risk appetite in the region.

In Japan, industrial production rose 0.5% in May, slightly below expectations, while the unemployment rate held steady at 2.5%.

The yen weakened to a 40-year low of around 162.4 against the US dollar, fueling expectations that Japanese authorities could intervene in currency markets. The weaker yen has supported exporters but increased import costs, adding pressure on households.

The yen's weakness has also increased political pressure on Prime Minister Sanae Takaichi's government.

Near the close, Japan's Nikkei 225 gained 1.6%, South Korea's Kospi advanced 3.2% and China's Shanghai Composite rose 0.2%, while Hong Kong's Hang Seng fell 1.2%.