Wall Street Indexes Rise Amid Rebound in AI Stocks
NEW YORK (AP) — A notable resurgence in AI stocks is propelling indexes upward on Wall Street this Monday. The S&P 500 experienced a 0.7% gain, despite the fact that most stocks within the index saw declines.
The ongoing strength of enterprises within the artificial intelligence technology sector contributed to a 1.3% increase in the Nasdaq composite, while the Dow Jones Industrial Average noted a minor setback, down 40 points, or 0.1%.
Recently, AI stocks have exhibited considerable volatility, attributed to concerns that their valuations may have escalated too rapidly.
Trepidations are mounting regarding whether the substantial investments pouring into AI chips and data centers can yield sufficient productivity and profit to justify the expenditures.
Broadcom surged by 3.8%, acting as a significant catalyst for the S&P 500 following the announcement of long-term agreements to supply silicon products to Apple.
This uptick follows two consecutive losses exceeding 2% on Wednesday and Thursday prior to the Fourth of July holiday.
AP AUDIO: Rebounds for AI stocks lift US indexes
The resurgence of AI stocks is providing vital support to Wall Street and resulting in mixed indexes.
Micron Technology ascended 3.5%, while Advanced Micro Devices experienced a notable jump of 9.2%.
Investors’ enthusiasm for AI will face a pivotal challenge later this week, as SK Hynix, the South Korean producer of computer memory, intends to raise $28 billion through a share offering that will be traded in the United States on the Nasdaq.
This potential offering is poised to become one of the largest in U.S. history, trailing only SpaceX’s recent IPO, which successfully garnered $75 billion.
SK Hynix’s shares in Seoul have more than tripled this year, catalyzed by the AI surge; however, the stock has also exhibited erratic fluctuations, including a sharp 14.6% drop just on Thursday.
Similarly, SpaceX, which possesses the xAI division, has witnessed its stock fluctuate post-IPO. It receded from an initial gain to fall by 0.7% on the last trading day before its anticipated inclusion in the Nasdaq 100 index, comprising the largest non-financial stocks.
This integration will necessitate funds, such as the QQQ exchange-traded fund, to purchase SpaceX shares.
In other AI developments, TeraWulf skyrocketed 12.3% after announcing a 20-year agreement with Anthropic for the utilization of its data center in Kentucky.
TeraWulf anticipates this deal will yield approximately $19 billion in revenues, marking a transition away from Bitcoin mining towards high-performance computing.
Turning to the oil sector, prices oscillated after OPEC+ declared on Sunday that seven of its members plan to augment oil production by a collective 188,000 barrels per day in August.
This marks the fifth consecutive month of output increases agreed upon by OPEC+ members.
The price of Brent crude, the international benchmark, inched up by less than 0.1% to $72.13, a figure reflective of levels preceding the U.S. and Israel’s military actions against Iran in late February, which had previously spiked prices.
In the bond market, Treasury yields remained relatively stable, with the yield on the 10-year Treasury dipping to 4.48% from 4.49% late Thursday.
A recent report indicated that growth in the U.S. recreation, finance, and other service sectors last month was largely in line with economists’ predictions.
The Institute for Supply Management noted that some businesses reported lower gasoline and diesel prices, suggesting a moderation of inflationary pressures.
In international stock markets, indexes experienced modest declines across much of Europe and Asia, although Hong Kong’s Hang Seng index emerged as an outlier, rising by 1.1%.
Source link: Apnews.com.
