Market Analysis Summary - February 25, 2026

Wall Street Rebounds

US equities experienced a recovery from a previous decline, with the Dow Jones Industrial Average rising by 0.76%, the S&P 500 increasing by 0.77%, and the Nasdaq 100 climbing by 1.05%. This resurgence was primarily driven by a renewed risk-on sentiment, particularly in technology stocks.

AI Optimism Resurfaces

The semiconductor sector saw significant gains, with the S&P software and services index rising by 1.3%. This uptick followed the launch of new artificial intelligence (AI) plug-ins by Anthropic, which alleviated concerns about potential disruptions in the market. Notable beneficiaries included Salesforce, FactSet, and Thomson Reuters.

Mega Chip Deal Lifts AMD

Advanced Micro Devices (AMD) shares surged by 8.8% after the company secured a substantial agreement to supply up to $60 billion worth of AI chips to Meta over the next five years. Additionally, Keysight Technologies saw a remarkable 23.1% increase in its stock price due to strong profit guidance, while Home Depot's shares rose by 2.0% after reaffirming its annual outlook.

Fed Highlights AI Labour Risks

Federal Reserve policymakers expressed differing opinions regarding the impact of AI on employment. Governor Lisa Cook raised concerns about potential job losses, while Governor Christopher Waller downplayed the likelihood of significant disruptions in the labor market.

Asia Rallies on Tech Strength

Asian markets mirrored Wall Street's gains, with Japan's Nikkei 225 index rising by 2.7% to reach a record high, and South Korea's Kospi increasing by 2.6%. Investors showed heightened interest in chipmakers ahead of NVIDIA's earnings report.

Yen Softens, Oil Near Highs

The Japanese yen traded around 156 per US dollar following the nomination of dovish candidates to the Bank of Japan's board. Meanwhile, Brent crude oil prices hovered near seven-month highs at approximately $71, influenced by ongoing US-Iran tensions and elevated geopolitical risks.

Dow Jones Recovery Analysis

The Dow Jones Industrial Average is recovering from a low of 49,696 this week and may revisit its previously breached uptrend line, now acting as resistance at 49,424. For a medium-term uptrend to resume, a rise and daily close above the February 20 high of 49,712 is necessary. Conversely, a drop below this week's low of 48,732 could target the November peak and January lows around 48,431 to 48,428.

EUR/JPY Continues to Rise

The EUR/JPY currency pair is on track to approach the ¥185.00 region after recovering from a mid-February low of ¥180.81. Minor resistance is expected between ¥184.18 and ¥184.43, with a significant peak at ¥184.92. Support is anticipated around the February 19 high of ¥183.15.

US Natural Gas Futures Near Key Support

US natural gas futures are declining and nearing critical support levels between 254.7 and 253.6, which correspond to early September to mid-October lows. Further support is found at the September low of 246.2 and the August low of 242.3. Immediate resistance is at the February 24 low of 265.3, which, along with the mid-February low of 269.8, may limit any short-term upside.

Outlook Summary

- **Short-term Outlook for Dow Jones**: Bullish while above the February 24 low of 48,732. - **Medium-term Outlook for Dow Jones**: Bullish while above the January low of 48,428, targeting the 50,600 region and above. - **Short-term Outlook for EUR/JPY**: Bullish while above the February 23 low of ¥182.00. - **Medium-term Outlook for EUR/JPY**: Neutral with a bullish stance while above the February 12 low of ¥180.81. - **Short-term Outlook for Natural Gas**: Bearish while below the February 23 high of 289.9. - **Medium-term Outlook for Natural Gas**: Bearish, targeting the 250-240 region and below while below the February 12 high of 301.0.