Stocks in the United States closed mixed. The Dow Jones rose, but technology stocks were hit by investor concerns that they are too expensive and speculation that the growth of artificial intelligence (AI) stocks has peaked.
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AI is shaking up Wall Street
The Dow Jones index rose 260.31 points, or 0.53 percent, to 49,501.3 points. The broader Standard & Poor’s 500 index fell 35.09 points, or 0.51 percent, to 6,882.72 points. The Nasdaq technology market index fell 350.61 points, or 1.5 percent, to 22,904.58 points. Alphabet shares weakened ahead of the earnings release. Investors expect the results to provide new insight into how Google’s massive investments in AI are contributing to its revenue growth. Shares of chipmaker AMD fell sharply as the company released a quarterly revenue outlook that disappointed investors and suggested it was struggling to compete with Nvidia.
Some software companies, such as Snowflake and Datadog, also ended up with losses. This is due to concerns that rapidly developing AI could disrupt the position of current players in the industry. Six of the 11 sectors that make up the S&P 500 index gained ground, led by real estate and energy companies. Shares in Super Micro Computer also rose after the company raised its annual revenue forecast thanks to continued demand for its AI-optimized servers. An optimistic earnings outlook also helped boost shares in pharmaceutical company Eli Lilly.
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The dollar is gaining strength
Due to the partial government shutdown, which ended on Tuesday, the government postponed the release of its January employment report, originally scheduled for Friday. Today’s ADP report showed that private sector jobs in the US rose less than expected in January, Reuters reported. The US dollar strengthened against a basket of leading world currencies. The dollar was helped by the latest statistics, which showed that the US service sector remained stable in January, although rising input costs signal a possible revival of inflation in the service sector.
The Japanese yen weakened for the fourth day in a row due to the upcoming elections, in which the current ruling coalition is expected to win a majority in the lower house of parliament. The dollar index, which tracks the dollar’s performance against a basket of six major world currencies, rose 0.2 percent to 97.66 points. The euro weakened 0.1 percent against the dollar to USD 1.1803. The dollar rose 0.8 percent against the yen to JPY 156.92. The euro rose 0.6 percent against the yen to JPY 185.21.
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Source: Reuters
