MARKET SNAPSHOT

U.S. stocks were mixed as buzz about AI products propelled large tech companies to more record highs. Treausury yields were little changed. Gold fell, while the dollar ticked up against rivals. Oil futures fell for a fifth consecutive drop.

MARKET WRAPS EQUITIES

Falling oil prices helped U.S. tech stocks stay buoyant Tuesday.

The tech-focused Nasdaq Composite Index rose 0.5%, hitting its second straight record. The S&P 500 was flat, while the Dow industrials slipped 0.4%.

President Trump addressed world leaders Tuesday morning at the United Nations General Assembly in New York, arguing that his overseas interventions had made the world safer. He also said he is considering restricting diesel exports in an effort to curb soaring fuel prices.

Stocks tied to the artificial-intelligence trade were mixed after an enthusiastic reception for Meta's new AI agent Monday. Other stocks viewed as vulnerable to the new agent fell, including financial names like Charles Schwab, LPL and Allstate.

Asian equities broadly gained. Taiwan's Taiex closed 0.2% higher after touching a record intraday high, led by gains in circuits and semiconductors. South Korea's Kospi rose 0.2%, paring earlier gains.

The earlier advance came amid renewed optimism about chip demand, as high interest in Meta Platforms' new AI agent in the U.S. boosted global AI stocks. Chipmakers SK Hynix and Samsung Electronics account for around 50% of the Kospi's market value.

China's Shanghai Composite Index ticked 0.1% higher, while the Shenzhen Composite and the ChiNext Price Index finished flat. Hong Kong's Hang Seng Index added 0.2%, led by AI rivals Tencent Holdings and Alibaba Group. The former launched its latest image-generation model that showed the company's latest AI progress, while the latter unveiled its new AI chip and outlined plans for a larger AI model at its annual conference.

Japanese financial markets were closed for the session.

Stocks in Australia gained, as the S&P/ASX 200 Benchmark Index rose 0.3%. In New Zealand, the S&P/NZX 50 Index gained 0.4%.

COMMODITIES

Oil futures fell for a fifth consecutive session on hopes for diplomatic progress in the Middle East and encouraging news about oil exports from the region.

Brent crude settled down 1.1% at $99.25 a barrel, its first close under $100 since Sept. 8. West Texas Intermediate for October delivery fell 1.2% to $94.59 a barrel as the contract expired.

Oil prices moved lower after Japan's Kyodo News Agency reported that Iran proposed to reopen the Strait of Hormuz if the U.S. lifts its blockade. Iran's Fars News Agency later said sources denied the reported offer.

Saudi Arabia, meanwhile, began running tests on its East-West pipeline on Tuesday, a step toward restoring flows as soon as this week after the pipeline was knocked out by attacks earlier this month, The Wall Street Journal reported, citing people familiar with the matter. Crude exports from the Red Sea port of Yanbu could restart within a couple of days, according to the people.

Gold futures settled modestly lower as the U.S. dollar firmed.

Front-month gold for September delivery settled down 0.2% in New York at $4,338.90 a troy ounce, while silver gained 0.2% to $65.932 a troy ounce.

The precious metals "remain within what appears to be a solid support range," Peter Cardillo of Spartan Capital said in a note.

TODAY'S TOP HEADLINES

Oil Prices Fall on U.S.-Iran Diplomacy Hopes

Oil futures fell for a fifth consecutive session on hopes for diplomatic progress in the Middle East and encouraging news about oil exports from the region.

Brent crude settled down 1.1% at $99.25 a barrel, its first close under $100 since Sept. 8. West Texas Intermediate for October delivery fell 1.2% to $94.59 a barrel as the contract expired.

Oil prices moved lower after Japan's Kyodo News Agency reported that Iran proposed to reopen the Strait of Hormuz if the U.S. lifts its blockade. Iran's Fars News Agency later said sources denied the reported offer.

Investors Demand Highest Yield at Two-Year U.S. Treasury Auction Since 2024

The U.S. Treasury on Tuesday auctioned $69 billion in two-year notes paying the highest yield in more than two years.

The notes sold at a yield of 4.787%, the highest since the May 2024 auction, when it was 4.917%.

The auction comes as investors brace for rising interest rates after hawkish communication from Federal Reserve officials followed the central bank's first rate increase since 2023 last week.

Fed's Barkin Says One Rate Hike May Not Be Enough to Tame Inflation

Richmond Fed President Thomas Barkin suggested more rate hikes could be coming as the central bank focuses all of its attention on taming inflation.

Speaking at an event in Baltimore, Barkin compared the Federal Reserve's dual mandate of price stability and maximum employment to raising two "very different kids."

The Federal Reserve chose last week to raise rates for the first time in three years because inflation has become a "troublemaker" that the central bank needs to address while the labor market "continues to get good grades," Barkin said according to a prepared text of his speech.

Alibaba Unveils New AI Chip, Outlines Plan for Larger Model

Alibaba has rolled out its most powerful chip yet, doubling down on its bid to control the software and hardware that power its artificial-intelligence ambitions.

The new AI chip-the Zhenwu V900-outperforms its predecessor by a significant margin, Chief Executive Eddie Wu said Tuesday. With larger GPU memory and bandwidth, its performance is three times better than the chip Alibaba released just four months earlier, signaling companies' push to accelerate development as competition intensifies.

"We anticipate significant growth in annual AI chip shipment volumes," Wu said at Alibaba Cloud's annual conference in Hangzhou.

SoFi Becomes First U.S. Bank to Settle Card Payments on Stablecoin

SoFi Technologies started settling card transactions using its own stablecoin on Tuesday, a program the company says is the first of its kind for a U.S. bank.

All debit- and credit-card transactions will be settled using SoFiUSD, its dollar-backed stablecoin, over Mastercard's payments network, SoFi said. The program is expected to process more than $25 billion annually.

The company said the shift will showcase how bank-issued stablecoins-a type of cryptocurrency pegged to the U.S. dollar and backed by assets like bank deposits or Treasury bills-can coexist with existing payment infrastructure by "helping bridge traditional financial systems and blockchain-based networks."

Expected Major Events for Wednesday 01:00/AUS: Aug Vacancy Report

02:00/SKA: Aug Department store sales

03:00/THA: Aug Trade data

05:00/SIN: Aug CPI

06:30/INA: Sep Bank Indonesia Board of Governors meeting and decision

07:00/MAL: Sep International Reserves, middle of month

08:00/TAI: Aug Industrial output

08:20/TAI: Aug Money Supply

08:30/HK: Aug CPI

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