The Vanguard FTSE All-World UCITS ETF is hovering just a fraction below its 52-week high, propelled by a powerful combination of stellar chipmaker earnings and easing geopolitical tensions. The fund closed Friday at €153.86, a whisker away from the €154.04 peak recorded in mid-April, as a broad-based rally in global equities gathered steam.
Chipmakers Lead the Charge
The semiconductor sector has been the undisputed engine of this week’s advance. Intel delivered its strongest quarterly performance in years, sending its shares surging 23.6% on Friday. That momentum spilled over to rivals, with Advanced Micro Devices jumping 13.9% and Qualcomm adding 10%. Nvidia, the poster child of the artificial intelligence boom, reclaimed a market capitalisation above $5 trillion in the final hours of trading.
The Philadelphia Semiconductor Index extended its winning streak to an unprecedented 18 consecutive sessions — a run with few historical parallels. For the Vanguard ETF, which allocates roughly a quarter of its underlying FTSE All-World Index to technology and two-thirds to US equities, the chip rally translated directly into fund performance. The S&P 500 and Nasdaq both closed at record levels, at 7,165 and 24,837 points respectively.
Earnings Season Exceeds Expectations
The broader earnings season is providing additional tailwinds. Some 83% of large US companies are currently beating profit forecasts, a figure well above the historical average. The strength is concentrated in tech and AI-related names, drawing fresh capital back into the sector after a period of rotation.
Not everything has gone smoothly. Software stocks stumbled mid-week after disappointing results and guidance from IBM and ServiceNow. Workday, Microsoft and Intuit also retreated, leaving the software segment roughly 30% below its autumn highs — a counterweight to the semiconductor optimism. Bank of England Deputy Governor Sarah Breeden cautioned that tech valuations appear stretched and warned that pullbacks remain a possibility.
Emerging Markets Add a Second Engine
The ETF’s broad diversification is proving its worth. Emerging markets have emerged as the strongest performer this year, with the relevant MSCI index climbing more than 14% since January. Oil-importing nations are benefiting disproportionately from the recent slide in crude prices. A barrel of West Texas Intermediate now trades below $84, a sharp drop from the $100-plus level seen just a month ago. That decline has eased fears of stagflation and taken some pressure off central bank policy expectations.
Geopolitical Winds Shift
Geopolitical developments have also brightened the mood. US President Donald Trump extended the ceasefire between Israel and Lebanon by three weeks, while renewed hopes for US-Iran talks contributed to the oil price retreat. The broad market was on track for its fourth consecutive weekly gain.
Yet the consumer picture remains fragile. The University of Michigan Consumer Sentiment Index fell to 49.8 in April — the lowest reading ever recorded, beneath even the depths of the financial crisis and the pandemic. While the figure slightly beat the 48.5 consensus estimate, it underscores the strain on American households.
What Comes Next
All eyes now turn to the Federal Reserve, which convenes for its rate-setting meeting on 28 and 29 April. The central bank has held rates steady and signalled just one cut for 2026, with elevated uncertainty stemming from the Middle East situation. A single rate reduction late this year remains the base case among market participants.
Barclays strategist Emmanuel Cau captured the prevailing sentiment: President Trump’s evident willingness to de-escalate, combined with a solid start to earnings season, should support equities in the near term. But he cautioned that a further sustained rally would require concrete progress in trade negotiations — something that remains elusive for now.
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