Market Wrap: Renewed confidence in AI drives stock market recovery (27.10.2026)

Markets are rebounding from the recent sell-off in technology shares. After weeks of investors dumping anything associated with artificial intelligence, buying interest has returned today, with equity indices from Tokyo to New York trading in positive territory.

However, the recovery faces an immediate test tomorrow when the Fed announces its interest rate decision and both Alphabet and Microsoft publish their quarterly earnings results.

Table 1: Earnings Calendar for This Week (26.10.2026 - 30.10.2026)

Source: XTB Research, 27.10.2026

Stock Market

An improvement in market sentiment was already evident during Asian trading hours. South Korea's KOSPI surged by 3.1%, driven by local memory chip manufacturers SK Hynix and Samsung ahead of their quarterly reports scheduled for this week. Meanwhile, Japan's Nikkei 225 gained 1.7%, supported by rallies in semiconductor equipment suppliers such as Tokyo Electron and Advantest.

Figure 1: Nikkei 225 (2026)

Source: XTB Research, 27.10.2026

Gains across the European continent remain considerably more muted. The Stoxx 600 edged up slightly (+0.2%), while the DAX and CAC 40 rose by around 0.3% to 0.4%. The UK's FTSE 100 noticeably lagged (-0.9%), dragged down by a 6% drop in HSBC following its results (more on this below).

Table 2: Gainers and Losers in Euro Stoxx 50 (27.10.2026)

Source: XTB Research, 27.10.2026

Nasdaq 100 futures point to a continued recovery in the US.

The turnaround was sparked by a series of major AI-related transactions, which the market interpreted as proof that demand for the technology remains robust. Three substantial deals surfaced within days: Anthropic's IPO filing, Meta's equity offering of up to $95 billion, and $63 billion secured by Broadcom from four Wall Street banks to fund proprietary chips and lease them to Anthropic.

Just a week ago, sums of this magnitude might have triggered a sell-off as further evidence of reckless spending; this time, investors viewed them as a signal of genuine demand. Semiconductor stocks benefited, with the Philadelphia Semiconductor Index rising 2.8% yesterday, its largest single-day gain in a month, despite Anthropic reporting a net loss of nearly $81 billion for the first half of the year in its IPO filing.

Table 3: Post-IPO Stock Performance (2012 - 2026)

Source: XTB Research, 27.10.2026

In US pre-market trading, chipmakers lead the gains today: Broadcom +3.3%, Micron +2.6%, Intel +2.1%, AMD +1.6%, and Nvidia +1.1%. Microsoft (-0.6%) is underperforming as it awaits the release of its Q3 financial results.

Sentiment was also boosted by today's earnings reports from non-tech sectors.

• Coca-Cola increased revenue by 7% to $13.4 billion, while its adjusted earnings per share rose 11% to $0.91, supported by a 5% increase in global sales volume. The company also raised its full-year guidance.

Figure 2: Coca-Cola Outlook (2020 - 2026)

Source: XTB Research, 27.10.2026

• Similarly, UPS, widely viewed as a bellwether for trade and economic health, grew revenue by 6.7% to $22.9 billion, delivered adjusted EPS of $1.69, and likewise upgraded its outlook ahead of the peak holiday season.

Figure 3: UPS Outlook (2020 - 2026)

Source: XTB Research, 27.10.2026

However, performance was not uniformly positive across all sectors.

• In Europe, HSBC disappointed as profit fell short of expectations and the bank failed to raise its net interest income forecast despite high interest rates, leading to a share price drop of around 6%.
• Porsche fared better (+4.1%), maintaining profitability despite a further decline in vehicle sales.

Energy Commodities

Against the backdrop of the stock market rally, crude oil remains surprisingly calm today. Brent crude (January contract) is holding around $110 per barrel, recording a modest decline of about 0.6% following recent sharp gains.

Figure 4: Brent and WTI Crude Oil (2026)

Source: XTB Research, 27.10.2026

This slight pullback can be attributed to initial, tentative diplomatic signals: representatives from Saudi Arabia, Pakistan, and Turkey travelled to Tehran to discuss ending the US-Iran war. However, the talks yielded no breakthrough, with the parties agreeing only to continue discussions, while Iranian Supreme Leader Mojtaba Khamenei reiterated Iran's firm conditions.

Geopolitics

In Israel, elections are underway today, the first since the Hamas attack in October 2023. Opinion polls indicate a very tight race between Prime Minister Benjamin Netanyahu and former armed forces chief Gadi Eisenkot. The outcome could shape Israel's future policy in the region, so the market will closely monitor the exit polls this evening.

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Michał Jóźwiak, Financial Markets Analyst at XTB