U.S. Stocks Rally as AI Optimism Boosts Global Markets

Global stock markets closed higher on July 21, 2026, fueled by cooling inflation expectations and optimism regarding artificial intelligence. U.S. benchmarks led the advance, with the NASDAQ Composite surging 1.29% to 25,837.21, the S&P 500 rising 0.89% to 7,509.20, and the Dow Jones Industrial Average gaining 0.74% to 52,224.82. Asian markets in Taiwan, South Korea, and Japan also saw significant gains, while Hong Kong and Malaysia ended slightly lower.

In currency markets, the U.S. dollar rallied against most major currencies, driven by economic data and intensified conflict in the Gulf. The Japanese yen emerged as the weakest G10 currency, falling 0.42% against the dollar. The Australian dollar remained flat, showing relative resilience compared to other currencies.

Maria Chen, an FX strategist at Global Markets Advisory, noted that the resilience of the Australian dollar was remarkable given the rampant dollar buying occurring elsewhere. She attributed this stability to the Reserve Bank of Australia, which has continued to talk down the prospect of near-term easing, making traders reluctant to short the currency aggressively.