“Sleepy Uber‑Bulls” Test Nerves As AI Fervour Meets Macro Crosswinds

On 17 February 2026, Reuters’ “Morning Bid” column described a world in which global stocks were steady, volatility muted and bond yields drifting lower—yet seasoned traders sensed that this calm rested on fragile foundations.

The piece dubbed investors “sleepy uber‑bulls,” noting that world equity indices hovered near record highs despite growing unease about AI valuations, geopolitics and the durability of disinflation. In the US, major indices closed with only marginal gains; in Europe, risk assets were similarly subdued, even as energy prices flickered on Middle East headlines.

For Asian markets, the picture was further complicated by holiday closures. With key bourses in Hong Kong, Singapore, Taiwan and South Korea shut for Lunar New Year, liquidity and price discovery were thin. Japan’s Nikkei, one of the few major regional indices open, slipped modestly, dragged by weaker GDP data and a slightly stronger yen.

Under the surface, however, risk premia were already being debated. ANZ and other houses reminded clients that while US–Iran and Ukraine talks hinted at possible diplomatic progress, any disappointment could quickly drive oil higher and reverse the recent easing in inflation expectations. For AI‑rich indices like the S&P 500, Nikkei and KOSPI, that would mean a fresh test of stretched valuations amid a less friendly rates backdrop.

Fixed‑income markets offered mixed signals. US Treasury yields had eased slightly from recent peaks, supporting equity multiples, but the broader trend remained one of elevated real yields compared with the pre‑pandemic era. That left investors debating whether they were being adequately compensated for holding long‑duration, growth‑heavy assets in a world where central banks might have less room to cut than in past cycles.

Commodity markets added another layer of complexity. Gold’s more than 2% slide on signs of progress in US–Iran talks suggested waning demand for traditional safe havens, even though other geopolitical risks—Ukraine, the South China Sea—remained unresolved. Oil was range‑bound but jumpy, with traders keenly attuned to news from Vienna and regional capitals.

For Gulf capital markets, the global “uber‑bull” mood offered opportunities and challenges. On the one hand, strong risk appetite and search for yield helped GCC sovereigns and corporates place sizeable bond issues in January at attractive terms, as Bloomberg’s issuance data show. On the other hand, the expectation of perpetually cheap money and benign volatility could encourage complacency just as the region’s geopolitical risk premium was set to rise.

In retrospect, 17 February sits at an inflection point: the moment when markets still looked calm on the surface, but positioning, valuations and macro narratives had quietly converged to make them vulnerable to the shocks that would erupt just weeks later in the Gulf.