Nasdaq leads gains on AI excitement
The tech-heavy Nasdaq closed higher on Tuesday, leading gains on Wall Street amid investor excitement about artificial intelligence before earnings reports from megacap technology companies Alphabet and Microsoft after the bell. Both Microsoft and Alphabet have launched an array of AI products since OpenAI, backed by Microsoft, released ChatGPT in late 2022. Investors expect the new products will help tech giants offset a slowdown in their cloud businesses. Shares in the owner of Google and the maker of Windows climbed 0.6 percent and 1.7 percent, respectively. "When you have this much enthusiasm for a specific investing theme, you don't need much of a reason for markets to move. It's inertia," said Steve Sosnick, chief strategist at Interactive Brokers. With the US central bank on track for another 25-basis point interest rate hike on Wednesday, policymakers face a choice over how much weight to put on recent economic data. "The Federal Reserve meeting tomorrow is reminding the market that it will be the second to last, if not the last, interest rate increase, and that has been a major concern for markets, particularly for tech stocks," said Rishi Sadarangani, chief investment officer at hedge fund R/Evolution Gate. A survey showed consumer confidence increased to a two-year high in July, amid continued optimism about the labour market despite worries about a recession. The tech-heavy Nasdaq Composite index has rallied this year, helped by outsized gains in rate-sensitive megacap growth companies and hopes for an end to the US Federal Reserve's tightening cycle. Companies outside tech are also performing well as lower valuations attract investors. The blue-chip Dow inched up for 13th day in a row, even as a 0.87 percent slide in Boeing capped gains. RTX tumbled 10.2 percent after saying many of its Pratt & Whitney GTF engines that power Airbus A320neo jets will need "accelerated removals and inspections". The Dow Jones Industrial Average rose 0.08 percent, to 35,438, the S&P 500 gained 0.28 percent, to 4,567 and the Nasdaq added 0.61 percent, to 14,145. General Electric jumped 6.27 percent after raising its annual adjusted profit forecast, while General Motors slumped 3.51 percent after it posted a decline in adjusted pre-tax profit and margins in its key North American market from the previous quarter. (Reuters)_____________________________
Last updated: 2023-07-26 HKT 09:02 