Global stock markets climbed to record highs on Tuesday as investors bet on falling interest rates and renewed optimism about global growth – with Apple reaching a market valuation of $4 trillion for the first time.
The FTSE 100 hit an intraday record of 9,715.22 before easing slightly to trade 0.5% higher at 9,698.4, while all three major US indexes – the S&P 500, Nasdaq and Dow Jones Industrial Average – also opened at all-time highs, rising between 0.3% and 0.7%.
The broad-based rally reflects growing confidence that the Federal Reserve will cut interest rates when its two-day policy meeting ends on Wednesday. This marks a pivotal moment for markets after nearly two years of monetary tightening.
Shares of Apple rose 1% to $269.86, pushing its total market capitalization to just over $4 trillion and cementing the company’s position as the world’s most valuable publicly traded company.
The rally was fueled by strong sales of the company’s latest iPhone lineup as well as investor confidence in the company to maintain premium margins through its services, wearables and AI-driven ecosystem.
Apple’s rebound comes just days before its quarterly earnings report due on Thursday, which investors expect will confirm steady growth in hardware sales and further expansion of its subscription services division.
“Apple remains the gold standard in consumer technology and profitability,” said Anita Sharma, senior tech analyst at Horizon Partners. “Breaking the $4 trillion mark is not just symbolic – it underscores the market’s confidence in Apple’s ability to monetize its ecosystem even in a slower global economy.”
Microsoft, Apple’s largest competitor by market capitalization, reclaimed the top spot earlier this week with a valuation of $4.06 trillion, buoyed by optimism ahead of tomorrow’s earnings release. The company’s investments in AI through OpenAI and its Azure cloud platform continue to generate investor enthusiasm.
The two tech giants have swapped places repeatedly this year, showing how leadership in the emerging AI and cloud computing competition is now driving investor sentiment in global markets.
Meanwhile, other big tech companies – including Alphabet (Google), Amazon and Meta Platforms – will also report results this week, setting the stage for one of the most consequential earnings seasons for Magnificent Seven tech stocks.
Beyond the technology sector, global stocks were boosted by improving trade relations and expectations of looser monetary policy in the US and Europe.
Recent data pointing to a moderation in inflation has encouraged investors to reinvest in risk assets, including growth-oriented sectors such as technology, industrials and consumer discretionary.
“The combination of easing inflation, weaker bond yields and central bank caution is creating a sweet spot for stocks,” said Chris Weston, head of research at Pepperstone. “Markets are now pricing in a Fed rate cut of 25 basis points – and perhaps two more by the end of the year.”
In London, the FTSE 100’s rise to 9,715.22 marked a historic high for the index, driven by gains in energy, banking and mining stocks as well as strong performances from AstraZeneca and HSBC.
Sterling held steady against the dollar at $1.28, benefiting exporters in the index, while bond yields fell slightly on speculation that the Bank of England could follow the Fed’s lead with a rate cut in early 2026.
Analysts said global optimism had trickled down to European markets, with Germany’s DAX and France’s CAC 40 also trading near record levels.
Attention now turns to Federal Reserve Chairman Jerome Powell, who will deliver the central bank’s policy statement and outlook on Wednesday. Markets are widely expecting a first rate cut since 2023, potentially signaling the start of an easing cycle.
U.S. inflation has fallen back toward the 2 percent target while growth remains robust – factors that investors see as supportive for stocks and risk assets.
But analysts warn that valuations of tech-heavy indexes are “extended,” with much of this year’s rally based on continued earnings growth from a narrow group of mega-cap companies.
“We are at a tipping point,” said David Blanchflower, a former Bank of England policymaker. “If central banks manage to engineer a soft landing, these levels could be maintained – but any hawkish surprises from the Fed would test market confidence.”
The record valuations of Apple and Microsoft have reignited the debate over the concentration of market power among US tech giants. Combined, the five largest companies – Apple, Microsoft, Alphabet, Amazon and Nvidia – now account for nearly 30% of the S&P 500’s total market value, a figure not seen since the dot-com boom.
Still, investors remain undeterred, viewing the dominance of AI-focused tech stocks as a long-term structural trend rather than a speculative bubble.
As Wall Street enters uncharted territory, one thing is clear: the market’s trillion-dollar titans are once again dictating the next phase of the global bull market.
