Wall Street AI stocks bounced as the Nasdaq Composite gained 308.43 points, or 1.18%, to 26,477.81. Technology led the gainers among the 11 major S&P 500 sectors. Chip stocks extended their rally to a third consecutive session.
The Dow Jones Industrial Average rose 15.99 points, or 0.03%, to 52,377.57. The S&P 500 gained 45.83 points, or 0.60%, to 7,722.60.
Why Did Wall Street AI Stocks Rally on Anthropic News?
Buzz about details of Anthropic’s impending initial public offering helped lift chip stocks. Growing concerns over debt-funded spending and rising borrowing costs had weighed on the AI trade this month.
Chuck Carlson, CEO at Horizon Investment Services in Hammond, Indiana, said the news “seems to be giving a little bit of a relief rally to the AI stocks, particularly the semis.”
Carlson added that those stocks “have gotten clobbered in recent weeks and they were probably due for a bounce.”
How Far Are Chip Stocks Below Their Peak?
The Philadelphia SE Semiconductor index is off more than 20% from its June 22 record closing high. It has still gained 62.1% this year, against the S&P 500’s 12.8% year-to-date advance.
Economic data showed rising new orders for computers and peripheral equipment. That supports the notion of strong AI-related spending.
What Did Meta’s US$97.5 Billion Equity Raise Do to Its Shares?
Meta increased its largest-ever equity fundraising to US$97.5 billion to fund its AI expansion. The Facebook parent’s shares fell 1.6% on the news.
Which S&P 500 Earnings Moved Stocks the Most?
Nearly half of S&P 500 companies have reported third-quarter results. Of those, 83% beat expectations, according to the latest available LSEG data.
- Boeing tumbled 10.7% after a bigger-than-expected third-quarter loss.
- Xylem slid 14.2% after trimming full-year forecasts.
- United Parcel Service advanced 5.8% after raising annual revenue and profit forecasts.
- Royal Caribbean rose 5.5% after lifting its full-year profit forecast.
- Sherwin-Williams fell 2.7% on a quarterly profit miss, weighing on the Dow.
Will the Fed Keep Rates Unchanged This Month?
The Fed convened on Tuesday for its October monetary policy meeting. It is widely expected to keep the fed funds target rate in the 3.75% to 4% range, according to CME’s FedWatch tool.
The second rate hike of the year is expected at the final meeting in December. Carlson said there is more confidence the Fed will not act this meeting, partly because of Tuesday’s election.
How Broad Was the Nasdaq Rally?
On the NYSE, advancing issues outnumbered decliners 1.83-to-1, with 81 new highs and 146 new lows. On the Nasdaq, 3,118 stocks rose and 1,680 fell, a 1.86-to-1 ratio.
Volume on US exchanges reached 16.10 billion shares, below the 17.18 billion average over the last 20 trading days. Energy shares posted the steepest decline as crude eased on Middle East peace negotiations.
What Is Next for Microsoft, Alphabet and Amazon?
Microsoft and Alphabet results are expected on Wednesday. Amazon.com is due to report on Thursday.
Malaysian investors tracking US AI names can compare these results with our AI Stock Analysis for Malaysians guide.
Key Takeaways
- The Nasdaq Composite gained 1.18% to 26,477.81, led by technology.
- The Philadelphia SE Semiconductor index is up 62.1% this year, but more than 20% below its June 22 record close.
- Meta’s US$97.5 billion equity raise sent its shares down 1.6%.
- 83% of reporting S&P 500 companies beat expectations, per LSEG data.
- The Fed is expected to hold the 3.75% to 4% range in October.
Disclaimer: This article is for general information only and is not financial advice. The source report covers US markets and names no Bursa Malaysia-listed company. Do your own research before making any investment decision.
Frequently Asked Questions
How much did the Nasdaq Composite gain on Wall Street?
The Nasdaq Composite gained 308.43 points, or 1.18%, to 26,477.81. Technology led the gainers among the 11 major S&P 500 sectors.
How much did Meta raise in its equity fundraising for AI?
Meta increased its largest-ever equity fundraising to US$97.5 billion to fund its AI expansion. Its shares fell 1.6% on the news.
Is the Fed expected to raise interest rates in October?
The Fed is widely expected to hold the fed funds target rate in the 3.75% to 4% range at its October meeting. According to CME’s FedWatch tool, the second rate hike of the year is saved for the December meeting.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.
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