Broadcom surges on OpenAI deal as gold hits record

Broadcom shares jumped nearly 10% late on Monday after unveiling a partnership with OpenAI to produce the startup’s first in-house AI chips, helping lift the S&P 500 by 1.6% and the Nasdaq by 2.2%. Gold reached a record $4,179 per ounce early on Tuesday, supported by growing expectations of US rate cuts, while silver also climbed to an all-time high of $53.60. Oil prices eased, with Brent trading at $63.04, as renewed US-China trade tensions and new port fees on shipping companies weighed on market sentiment.

Equities

The FTSE 100 closed 0.16% higher on Monday, helped by gains in mining stocks after US President Donald Trump softened his tone on trade tensions with China. The index had fallen 0.9% on Friday following Trump’s threat to impose 100% tariffs on Chinese imports. Precious metal miners led the advance as gold broke through $4,100 per ounce for the first time.

Fresnillo rose 9.1%, while Endeavour Mining climbed 11.3%. Industrial metal miners also moved higher, with the sector up 3.1% as copper prices strengthened. Among the blue-chip names, Anglo American, Glencore and Rio Tinto each rose between 2% and 4.1%, lifting the broader index further.

Investor sentiment was supported by comments from Bank of England policymaker Megan Greene, who said late on Monday that interest rates were likely to fall further following last month’s decision to keep the benchmark rate at 4%. She warned, however, that the pace of inflation easing may be slowing.

In the mid-cap market, the FTSE 250 gained 1.2% after a flurry of merger and acquisition activity. Shares in Big Yellow Group jumped 15.4% after US private equity firm Blackstone said it was considering a cash offer for the self-storage company. Rival Safestore climbed 9.4% on the same news, while Tritax Big Box added 3.8% after agreeing to acquire Blackstone’s UK logistics assets for £1.04 billion and confirming that Blackstone would take a 9% stake in the company. The broader real estate sector ended 2.6% higher. Oxford Instruments fell 7.6% after warning that first-half revenue would decline, with management saying the shortfall was unlikely to be recovered later in the year.

Across the Atlantic, Wall Street rallied sharply on Monday following comments from Trump suggesting a willingness to ease tensions with Beijing. The S&P 500 rose 1.56% to 6,654.72, the Nasdaq gained 2.21% to 22,694.61 and the Dow Jones Industrial Average climbed 1.29% to 46,067.58.

Chipmakers led the rebound. Broadcom surged nearly 10% after announcing a partnership with OpenAI to produce the startup’s first in-house artificial intelligence processors. Nvidia rose 2.8%, Micron Technology jumped more than 6% and the PHLX semiconductor index gained almost 5%.

Oracle added 5.1% after brokerages raised price targets on the AI-focused cloud firm, while Estee Lauder advanced 5.8% after Goldman Sachs upgraded the stock to “buy”. Fastenal dropped 7.5% after missing quarterly profit expectations. JPMorgan Chase, Goldman Sachs, Citigroup and Wells Fargo will report earnings on Tuesday, marking the start of the US bank reporting season.

Forex & Commodities

The US dollar slipped on Tuesday as tensions between Washington and Beijing resurfaced, weighing on risk appetite and sending investors towards safer assets. Beijing announced countermeasures against five US-linked subsidiaries of South Korea’s Hanwha Ocean and opened an investigation into how a US trade probe affects its shipping industry.

The euro rose to $1.1585, while sterling moved up to $1.3351. The yen strengthened to 151.86 against the dollar, and the Swiss franc also gained to 0.8027. The Australian dollar weakened to $0.6475 and the New Zealand dollar eased to $0.5697 after investors turned away from risk-sensitive currencies.

Spot gold rose early on Tuesday to a record high of $4,179 per ounce, driven by stronger expectations of US Federal Reserve rate cuts and renewed safe-haven buying. Silver also reached an all-time high of $53.60. Platinum traded at $1,677 and palladium at $1,505. Bank of America and Société Générale now forecast gold to reach $5,000 by 2026, while Standard Chartered lifted its 2026 forecast to $4,488.

Oil prices fell in early Asian trading on Tuesday as trade friction between the US and China raised concern over fuel demand. Brent crude slipped to $63.04 per barrel and US West Texas Intermediate traded at $59.26. The Organisation of the Petroleum Exporting Countries said on Monday that supply shortfalls are likely to narrow next year as OPEC+ increases output.