NEW YORK: US stocks ended sharply up on Thursday (July 18), with the S&P 500 approaching record highs as artificial intelligence (AI) optimism drove gains in Nvidia and other chipmakers.
The Dow Jones Industrial Average rose 202.01 points, or 0.54%, to 37,468.68, the S&P 500 gained 41.73 points, or 0.88%, to 4,780.94 and the Nasdaq Composite added 200.03 points, or 1.35%, to 15,055.65.
US-listed shares of Taiwan Semiconductor Manufacturing soared nearly 10% after the world's largest contract semiconductor maker projected 2024 revenue growth of more than 20% on booming demand for high-end chips used in AI applications.
Heavyweight chipmaker Nvidia rose 1.9% to a record high, and it was the most-traded company on Wall Street, with almost US$28 billion (RM132 billion) worth of shares exchanged. Rival Advanced Micro Devices rose 1.6% and also notched a record high.
Broadcom, Qualcomm and Marvell Technology gained more than 3% each. The Philadelphia SE semiconductor index rallied 3.4% and approached its December 2023 record high.
“AI has caused this industry to have a ‘rip your face off’ rally, and I don’t think it’s stopping anytime soon,” said Jake Dollarhide, CEO of Longbow Asset Management.
Apple jumped 3.3% after BofA Global Research upgraded the iPhone maker’s stock to “buy” from “neutral”. That helped the S&P 500 information technology index rise 2% and hit a record high.
Data showed the number of Americans filing new claims for unemployment benefits fell last week to a late-2022 low, suggesting solid job growth in January.
Wall Street has wavered in recent sessions as investors became less sure the Federal Reserve will begin cutting interest rates in March.
The S&P 500 lost ground on Tuesday and Wednesday following strong December retail sales data and after policymakers talked down expectations for an early start to rate cuts.
Traders now see a 56% chance for a 25-basis-point rate cut in March, compared with a chance above 80% a month ago, according to the CME Group’s FedWatch Tool.
Interest rate-sensitive sectors dipped, with the S&P 500 real estate index down 0.6% and utilities index losing 1.05%.
Humana dropped 8% after the health insurer forecast fourth-quarter medical costs to be higher than previously expected. Peer UnitedHealth fell 1.6%.
Spirit Airlines ended down more than 7% after news it is looking at options to refinance its debt and is not considering restructuring. – Reuters