Global stocks rebound as traders assess Al fallout and new US tariffs

European and US stocks bounced higher as investors recovered from a fresh bout of angst over Al and new US tariffs.

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Wall Street's main indices shed more than one per cent on Monday as the market “went through another disruption trade that was a three-headed monster of tariffs, Al displacement, and private credit concerns”, said market analyst Patrick O'Hare.

While dipping further at the open, they soon recovered and pushed higher.

The market's Jekyll-and-Hyde attitude towards Al shifted on Tuesday after an announcement that tech giant Meta had reached an agreement to purchase millions of chips from processor manufacturer AMD, in which it could become a shareholder.

Shares in AMD jumped 6.1 per cent as trading got underway, while shares in Meta shed 1.1 per cent.

Nevertheless “investors are wary as they brace for further volatility sparked by unpredictable US trade policy and the fallout from Al advances,” said Susannah Streeter, chief investment strategist at Wealth Club.

Sentiment had been dampened by renewed concerns about the impact of artificial intelligence on the tech sector, with software firms again in the firing line.

The latest blow came from a report Sunday by a firm called Citrini Research that used possible scenarios set in the future showing parts of the global economy that could be at risk from new tools, such as credit card and food delivery firms.