Global stocks rose to a new record high after the Federal Reserve cut interest rates this week and its positive assessment of the US economy boosted investor sentiment. The MSCI All Country World Index, one of the broadest indices measuring the performance of stock markets, rose 0.2% on Friday, after closing at an unprecedented record level in the previous session. The S&P 500 index also rose to a new high, while the volatility index (VIX) fell to its lowest level in three months. The MSCI Asian share index rose 1.3%, on course for its highest close in a month. Tech stocks in Asia fell like their counterparts in the United States, marking the extension of the bullish wave that has sent the global stock index up about 21% during the year 2025, putting it on track for its best annual performance since 2019. Stock market optimism in 2026 “The momentum is expected to continue until the end of the year,” said President of G Bolvina Bolvinal Group. “With the start of the cycle of rate cuts, with a new Fed president soon to take office, and profits rising, the bull market looks set to continue into 2026.” She added: “As more companies adopt artificial intelligence, the spread will widen, and sectors may begin to strengthen their power against the G7 (Apple, Alphabet, Nvidia, Amazon, Meta, Microsoft, Tesla).” While the S&P 500 rose 0.2% to hit a record high on Thursday, there was some caution towards tech stocks. Shares of Broadcom, the chipmaker that competes with Nvidia for artificial intelligence computing revenue, fell in extended trading after its sales forecast for the accelerating market fell short of investors’ high expectations. Read more: Broadcom shares fall after disappointing AI market revenue forecasts S&P 500 futures were flat in Asian trade on Friday, while Nasdaq 100 futures fell 0.1%. Japan’s Topix index led regional gains, with financial sector shares benefiting amid almost certain expectations that the Bank of Japan will raise interest rates next week. Chinese stocks lagged their peers after the Chinese leadership signaled it would continue to support the economy without raising stimulus next year. US economic outlook After implementing the third consecutive interest rate cut on Wednesday, Federal Reserve Chairman Jerome Powell expressed optimism that the US economy will continue to improve as the inflationary impact of rates fades. While Fed officials have maintained their expectations of only one cut in 2026, traders continue to bet on two cuts. Also read: Powell hints at a temporary pause in the monetary easing cycle next year. The Fed now expects the US economy to grow 2.3% next year, up from a previous forecast of 1.8%, with inflation expected to slow to 2.4%. The Bloomberg Dollar Index traded near its lowest level in two months on Friday and was headed for a third weekly loss. 10-year Treasury yields held steady after a slight rise on Thursday, when data showed initial jobless claims rose more than estimated during the week ended Dec. 6. Asian markets under scrutiny Elsewhere, the Malaysian ringgit rose to its strongest level against the dollar in more than four years, reflecting optimism about the Southeast country’s trade economy and Asian economy. Markets in Thailand were the focus of traders’ attention after Prime Minister Anutin Charnvirakul announced the dissolution of parliament, in preparation for early elections, following reports that a major political party had withdrawn to support his minority government. The tech sector remained the focus of investors’ attention, after Broadcom’s declines followed Oracle’s results earlier in the week, raising concerns about high valuations and whether big investments in artificial intelligence infrastructure are paying off. “We’ve reduced our exposure to equities a bit towards the end of the year because we’re a bit concerned about the vibrations in the AI ​​sector and the uncertainty around the Fed’s stance,” Ben Bennett, head of Asia investment strategy at Legal & General Investment Management Ltd, said in an interview with Bloomberg TV. In commodity markets, copper rose to a new record high on Friday, with most other industrial metals rising after the Fed’s decision. Gold stabilized after three days of gains, while silver traded near a record high, while oil recovered from its lowest close in nearly two months.