Nasdaq ends best quarter in 6 years as yen extends drop against dollar

The tech-heavy Nasdaq index finished Tuesday, June 30, 2026, with its strongest quarter in six years, marking a 21.4% increase over the three months ending in June. This rally, alongside other US indices like the S&P 500 and the Dow Jones, was buoyed by widespread optimism surrounding artificial intelligence, which overshadowed concerns about geopolitics and inflation.

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Very often when we have a really good quarter, you see profit-taking on the last day. We're not seeing that today which shows optimism about the third quarter as well.

The Dow Jones Industrial Average closed at a record high for the second consecutive session. Analysts noted a lack of profit-taking on the final day of the quarter, suggesting sustained optimism for the third quarter. This positive sentiment was partly attributed to a pullback in oil prices following a memorandum of understanding between the United States and Iran, which eased tensions and boosted tanker traffic in the Strait of Hormuz. Lower energy prices are expected to support GDP growth in the second half of the year.

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If we go into the second half of the year with lower energy prices, that should help restore GDP growth.

AI-linked stocks, which had experienced a recent pullback amid questions about their soaring valuations, saw a return to the dominant trend of the quarter. Meanwhile, European equity markets also closed higher on Tuesday. In Asia, Seoul's Kospi index rose one percent, though it remained below a recent record high. The index, which includes major chipmakers like SK Hynix and Samsung, surged nearly 68% during the quarter.

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If the jobs report comes in strong, it could put upward pressure on yields as investors price in higher odds of a July rate hike.

Tokyo's market focused on the yen, which has fallen to 40-year lows against the dollar, reaching as low as 162.67 per dollar. This decline is fueled by expectations that the US Federal Reserve might raise interest rates this year. Ahead of US jobs data, analysts warned that a strong report could increase bets on an earlier Fed rate hike. Despite a recent increase in borrowing costs by the Bank of Japan, the yen has not been supported, and government officials have signaled readiness to intervene.

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A major catalyst behind the dollar's move has been the arrival of new Federal Reserve chair Kevin Warsh, whose public comments have been interpreted as notably more hawkish