- The Nasdaq rises about 0.9%, lifted by a recovery in chip stocks.
- Oil prices advance after more fighting in the Middle East overnight; Brent crude futures settled at their highest level since mid-June.
- AI stocks rallied for a second straight day, led by gains in chipmakers, after a previous week of declines.
- Brent crude oil rose 2.2% to $91.22 and briefly neared $92, up from less than $72 before the war with Iran.
- The S&P 500 climbed 0.9%, the Dow rose 480 points (0.9%), and the Nasdaq composite gained 1.4%.
- Rising oil prices threaten a reacceleration of inflation, potentially pushing the Federal Reserve to raise interest rates.
- AI stocks had soared on investment but came under pressure due to worries they are overvalued and may not produce expected profits.
The Nasdaq Composite rose 1.4% on Tuesday, driven by a resurgence in chip stocks, particularly Micron Technology, which surged 13.1%, and Nvidia, which gained 1.3%. This uptick comes as AI stocks recover from a recent slump, with investors optimistic ahead of earnings reports from major tech firms like Alphabet, Tesla, and IBM scheduled for tomorrow.12569
Oil prices also saw significant movement, with Brent crude climbing 2.2% to settle at $91.22, nearing $92 for the first time in over five weeks due to ongoing conflicts in the Middle East. This increase in oil prices raises concerns about a potential reacceleration of inflation, which could prompt the Federal Reserve to consider raising interest rates to manage economic stability.34781011
Despite the positive movement in the Nasdaq, the S&P 500 and other indexes have been relatively flat in recent weeks, reflecting investor caution amid geopolitical tensions and the uncertain profitability of AI investments. “Concerns are also weighing that investment in AI may fall off if it doesn’t produce as much profit and productivity as hoped,” analysts noted.
The yield on the 10-year Treasury rose to 4.63%, up from 4.60% late Monday, indicating market reactions to the shifting economic landscape.
“Micron Technology surged 13.1% and Nvidia added 1.3%, lifting the S&P 500 0.9% and the Dow 480 points. Rising oil prices above $91 threaten to reaccelerate inflation, potentially pushing the Federal Reserve to increase interest rates.”
WSJ
