Global Markets Steady Amid AI Fears and Economic Data Deluge

World shares stabilized on Monday following a previous drop driven by AI-related concerns and a light trading day due to the Lunar New Year in Asia and President's Day in the U.S. Major Asian markets like China, South Korea, and Taiwan remained closed, while MSCI's world shares index edged up by 0.1% as currency and bond markets found balance.

In the absence of U.S. stock and bond market activity, European shares witnessed a gain led by the banking sector's partial recovery from last week's AI-induced distress. This upward movement contributed to a 0.4% rise in the STOXX 600 index. Japan's announcement of a sluggish 0.2% economic growth in the fourth quarter underlined the potential challenges ahead for Prime Minister Sanae Takaichi's fiscal stimulus plans, as the Nikkei index closed 0.2% lower.

In the U.S., earnings reports continue, with Walmart in focus for insights into consumer spending trends after a lackluster December for retail sales. Defensive stocks gained appeal amid a strategic shift from technology investments, as the burgeoning costs associated with AI caused a reevaluation of capital expenditures. The dollar index fell last week, but Monday saw a modest recovery against the yen.