Tech stocks boost Wall Street
Tech giants help Wall Street to a plus. Google's parent company Alphabet in particular is experiencing price fireworks, as is AMD - possibly triggered by the AI hype. Meanwhile, data on the US labor market is eagerly awaited.
Price gains at Google parent Alphabet and other tech giants drove Wall Street higher on Thursday. The Dow Jones index of blue chips was up slightly at 36,108 points. The broader S&P 500 gained 0.8 percent to 4,585 points and the Nasdaq technology exchange rose 1.4 percent to 14,343 points.
Alphabet jumped 6.4 percent. The shares of Apple, Nvidia and Intel each gained around 1.5 percent in their wake. Alphabet had presented a new artificial intelligence (AI) model on Wednesday. "It's basically a tale of two stock markets today - one with technology stocks and one with everything else," said Ken Mahoney, managing director of asset manager Mahoney in New Jersey. "Alphabet may not be reliant on AI revenue, but technology is a positive for earnings."
Investors also stocked up on AMD. The chip manufacturer's shares gained a good eight percent following an optimistic forecast for the market for its AI processors.
Among individual stocks outside the tech sector, investors bought into Walgreens Boots Alliance. The pharmacy chain's shares rose by 8.5 percent. Walgreens Boots is expanding its range of tests and treatments for Covid-19 and influenza for the winter season. Bristol-Myers Squibb was also in demand. The pharmaceutical company's shares advanced by a good two percent. The company's Board of Directors has approved an additional share buyback plan worth three billion dollars.
Waiting for US labor market data
Investors are now eagerly awaiting the US government's official labor market report scheduled for Friday. Experts expect job growth of 180,000 after 150,000 in October.
The Fed is trying to curb inflation with interest rate hikes and cool down the hot labor market in the process. The publication at the end of the week could be one of the last before the Fed meeting on December 13, which could persuade the central bankers to raise interest rates again after all.
Hopes of falling interest rates have recently triggered a rally on the stock markets. However, many analysts believe this is exaggerated. "The Fed certainly has no plans to cut interest rates any time soon. Its future moves will depend on the data," said Joe Saluzzi, manager at broker Themis Trading. Konstantin Oldenburger, analyst at broker CMC Markets, agreed with him. "Too dynamic a change of course in monetary policy could ultimately turn from a blessing into a curse for the stock markets if investors price in more and faster interest rate cuts."
The dollar index slumped by 0.7 percent to 103.472 points. The euro, on the other hand, gained 0.4 percent to 1.0803 dollars.
Oil price continues to fall
On the oil market, prices continued their downward slide after a brief recovery. North Sea Brent and US light oil WTI both fell by around half a percent to 73.93 and 69.16 dollars per barrel (159 liters) respectively.
Investors continued to worry about sluggish demand and the economic downturn in the USA and China. Last week's Opec+ decision on production volumes also made investors skeptical. As the agreed supply cuts are voluntary, analysts question whether producers will implement them in full or not. "Opec+ is probably no longer so happy with its latest agreement," stated Craig Erlam, analyst at trading house Oanda.
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Alphabet Inc., the parent company of Google, saw a significant 6.4% increase in its stock price due to the presentation of a new AI model, contributing to the tech stocks boom on Wall Street.
In the midst of this tech-driven market surge, AMD also experienced a substantial gain of 8%, bolstered by an optimistic forecast for the market for its AI processors.
The oil price, however, continued to decline, with both Brent and WTI falling by around half a percent, causing concerns among investors due to sluggish demand and an economic downturn in the USA and China.
Source: www.ntv.de
