Global equity markets extended their recent rally as a decline in crude oil prices eased concerns over inflation and renewed enthusiasm surrounding artificial intelligence provided additional support to stocks.

The S&P 500 rose 0.7 percent, moving closer to its first record close since August, while the Nasdaq 100 and Dow Jones Industrial Average also gained 0.7 percent. The Stoxx Europe 600 advanced 0.4 percent and the MSCI World Index increased 0.7 percent.

The decline in energy prices provided some relief to investors concerned about the inflationary impact of elevated crude prices. Brent crude fell to around $98 a barrel, while West Texas Intermediate crude declined 1.6 percent to $88.02 a barrel. Lower oil prices have helped ease pressure on inflation expectations and provided some support to bond markets.

Technology stocks remained a major driver of the equity advance. Nvidia’s market value moved closer to $6 trillion, while Advanced Micro Devices CEO Lisa Su said chip demand is expected to remain very high over the coming years. The developments reinforced investor confidence in the AI investment cycle that has been a major contributor to the broader equity market rally.

Analysts also highlighted strong corporate earnings expectations as an important support for equities. Kyle Rodda of Capital.com said markets have remained resilient despite concerns surrounding energy prices and interest rates, with expectations for corporate earnings providing an additional, less-discussed source of support.

Ulrike Hoffmann-Burchardi of UBS Chief Investment Office said the US economy continues to provide a supportive environment for corporate revenues and profits. She maintained a positive view on the AI growth theme and said continued AI-related investment could remain a significant tailwind for equities, while favorable economic conditions and strong earnings could allow profit growth to broaden beyond the technology sector.

Historically, equities have been able to perform through periods of rising interest rates when economic activity and corporate profits continued to expand. Anthony Saglimbene of Ameriprise said stocks could continue to move higher if the outlook for 2027 growth and profits remains firm, energy prices stabilize or decline, and the Federal Reserve indicates that any rate-hiking cycle will be relatively short-lived. He added that maintaining momentum in the AI trade would also be important for further gains.

Global growth expectations have also remained relatively resilient despite geopolitical fragmentation, higher energy costs and tariffs. Analysts at Pacific Investment Management Co. said major economies have so far absorbed higher costs better than expected. They expect global growth to remain resilient over the next six to 12 months while inflation moderates.

According to the PIMCO view, strong AI investment, consumers and China absorbing higher costs, and a gradual approach by central banks could support economic activity while limiting inflationary pressure.

In currency markets, the Bloomberg Dollar Spot Index declined 0.2 percent, while the euro rose 0.3 percent to $1.1252 and the British pound gained 0.3 percent to $1.3268. The Japanese yen weakened 0.1 percent to 158.09 per dollar.

In bond markets, the US 10 year Treasury yield was broadly unchanged at 5.30 percent. Germany’s 10 year yield remained at 3.49 percent, while the UK 10 year yield declined two basis points to 5.40 percent.

In cryptocurrencies, Bitcoin rose 0.6 percent to $86,264.60, while Ether was broadly unchanged at $2,713.47. Spot gold gained 0.4 percent to $4,154.71 an ounce.

The combination of easing oil prices, resilient economic growth, strong earnings expectations and continued AI investment has helped global equities maintain their upward momentum despite persistent uncertainty around interest rates and geopolitical developments.