World shares were mostly higher Monday and oil prices fell after rising last week to their highest level in more than four years. Investors were bracing for earnings reports of big companies and central bank decisions this week that could shake markets, analysts said. Several influential AI-related companies report their latest financial results this week, including Google’s parent, Alphabet, along with Microsoft and Amazon. In early European trading, Germany’s DAX surged 0.7 per cent to 25,363.59, while the CAC 40 in Paris picked up 0.9 per cent to 7,848.62. Britain’s FTSE 100 added 0.5 per cent to 10,742.88. The future for the S&P 500 was up 0.2 per cent while that for the Dow Jones Industrial Average gained 0.4 per cent. Asian markets started the day off with losses, though some benchmarks bounced back. Tokyo’s Nikkei 225 slipped 0.8 per cent to 62,189.65 as shares of computer chipmakers and other tech firms came under renewed selling pressure. Advantest, which makes testing equipment for computer chips, fell 3.9 per cent, while chip- and flat-panel production manufacturer Tokyo Electron lost 3.7 per cent. The Bank of Japan is due to announce a decision on its key interest rate later in the week. The Kospi in Seoul dropped 1.5 per cent to 5,469.47. Memory chipmaker Samsung Electronics lost 1.1 per cent. In Hong Kong, the Hang Seng picked up 0.5 per cent to 23,211.81, while the Shanghai Composite index rebounded from early losses to gain 0.2 per cent, closing at 3,697.52. Australia’s S&P/ASX 200 likewise reversed its losses to advance 0.2 per cent, to 8,809.90. The price of Brent crude, the international standard, fell 1.7 per cent to US$109.86 a barrel. U.S. benchmark crude sank 2.1 per cent to US$101.08 a barrel. On Friday, the price for a barrel of Brent crude rose 3.1 per cent to settle at US$116.72, its highest level since June 2022. It has surged from less than US$97 since early October. Also Friday, the S&P 500 fell 0.5 per cent, adding to its decline from a day before and logging its second-straight weekly loss. The Dow fell 1.2 per cent, and the Nasdaq composite slipped 0.2 per cent. Several AI-related companies rallied, helping ease some of the impact from the broader market slide. Stocks that have benefited from the frenzy over AI have been buffeted by waves of selling as investors fret over whether their high prices are justified. Many of those companies have been borrowing to fund investments in AI technology and high interest rates are making those loans more expensive. Market players are closely watching corporate earnings, looking for a better sense of whether those investments are likely to pay off. “This week is less about broad conviction and more about proof. Big Tech now has to show that the spending binge still deserves the market’s faith,” Stephen Innes of SPI Asset Management said in a commentary. “Investors want proof now. They want to know whether the billions going into the compute buildout are building a durable earnings machine or just a shinier version of the same old capex furnace,” he said. American Express slumped 3.7 per cent, one of several financial stocks that lost ground, despite reporting profits for its most recent quarter that beat analysts’ forecasts. The company did announce its first major job cuts in roughly a decade. Treasury yields in the U.S. edged higher following sharp drops on Thursday. Yields have been rising globally, partly over worries about governments taking on too much debt. Inflation also remains a concern and is stubbornly well above three per cent in the U.S. That prompted the Federal Reserve to raise its benchmark interest rate at its last meeting in an effort to cool inflation. Wall Street expects the central bank to hold rates steady at its meeting this week, but is leaning heavily toward another rate hike in December. This week also will bring several big economic updates, including the Fed’s preferred measure of inflation. The personal consumption expenditures index, or PCE, is expected to show that inflation rose at a 3.7 per cent rate in September, sharply above the Fed’s two per cent target. The U.S. war with Iran has severely cut the world’s oil supply, driving energy prices higher and fueling a sharp jump in the cost of everything from gasoline to food and clothes. In other dealings early Monday, the dollar rose to 157.28 Japanese yen from 156.99 yen. The euro fell to US$1.1212 from US$1.1223. Elaine Kurtenbach, The Associated Press
