S&P 500 targets new highs as AI momentum and trade stability boost risk

Risk appetite has improved across financial markets as the S&P 500 eyes fresh record highs, driven by continued AI sector momentum and easing trade tensions. The positive sentiment has created a mixed environment for safe-haven currencies, with the US dollar showing resilience despite the risk-on mood. EUR/USD and GBP/USD movements reflect this complex dynamic, as improved risk sentiment typically weakens the dollar but is being offset by other fundamental factors. The Nasdaq 100 continues to benefit from AI-related optimism, while the FTSE 100 participates in the global equity rally. The trade truce mentioned suggests reduced geopolitical tensions, which traditionally supports risk currencies like the Australian and New Zealand dollars while potentially weakening the Japanese yen and Swiss franc. For forex traders, this environment suggests continued volatility in major pairs as markets balance risk appetite against central bank policy divergences and economic fundamentals.