UPDATE: Wall Street is experiencing a significant surge today as investors react to the groundbreaking chip-supply deal between AMD and OpenAI. The latest developments are driving enthusiasm around artificial intelligence and overshadowing fears of a prolonged federal government shutdown, with the S&P 500 and Nasdaq Composite posting early gains.
As of early trading, the S&P 500 has risen by 0.13% to 6,724.38, while the Nasdaq Composite increased 0.38% to 22,865.97. AMD’s stock has soared a staggering 26.6% to reach its highest price in over a year, reinforcing its status as the top performer on the benchmark index.
Investment strategist Leah Bennett at Concurrent Asset Management commented, “The dollar amounts around these partnerships and the infrastructure to support AI are getting to be really astounding.” Her remarks highlight the excitement surrounding tech investments, particularly in AI, despite some analysts warning about elevated valuations.
The rally in tech stocks has not been limited to AMD. Other chipmakers also saw substantial gains, including Marvell Technology and Micron Technology, which rose by 4.2% and 5.5%, respectively. Additionally, Super Micro Computer, a leading AI server maker, spiked by 6.3%. AI-centric firms like Palantir Technologies and Oracle also reported gains of 5.0% and 2.3%.
In contrast, the Dow Jones Industrial Average fell by 0.47%, dropping 218.34 points to 46,540.49, primarily due to losses in major companies like Home Depot and McDonald’s. The mixed performance shows that while the tech sector thrives, broader market concerns linger.
The ongoing federal government shutdown has delayed the release of crucial economic indicators, including the non-farm payrolls report. Analysts predict that the Federal Reserve may cut rates by 25 basis points at its next meeting, particularly as Goldman Sachs anticipates a military pay date on October 15 will pressure lawmakers to resolve the deadlock. If the stalemate continues, approximately 1.3 million uniformed military personnel could go unpaid, further complicating economic visibility for the Fed.
Investment analyst Bret Kenwell from eToro stated, “While the government shutdown is the focus now, earnings and the Fed will soon take center stage.” With the third-quarter earnings season set to kick off next week, approximately 68% of companies representing 72% of market capitalization are expected to report by the end of October, which will be a critical test of market resilience.
In notable stock movements, Tesla gained 2.0% after teasing a major event on social media, while Comerica surged 13.9% following an announcement of its acquisition by Fifth Third Bank in an all-stock deal valued at $10.9 billion. However, shares in Fifth Third declined 1.5% amid mixed market reactions.
As the market continues to react to these developments, crypto stocks are also seeing upward movement with Bitcoin nearing all-time highs. Shares of Coinbase Global rose 1.0%, while Riot Platforms jumped 4.9% and MARA Holdings climbed 3.7%.
With declining issues outnumbering advancers by a 1.01-to-1 ratio on the NYSE, and a 1.24-to-1 ratio on the Nasdaq, the market remains volatile. The S&P 500 registered 28 new 52-week highs and six lows, while the Nasdaq Composite recorded 121 new highs and 27 lows.
Stay tuned as this situation develops, with potential market shifts expected in the coming days.
