JABAR EKSPRES – Stocks on Wall Street were mixed in late morning trading Friday (5/26), as companies connected to artificial intelligence (AI) fueled investor enthusiasm, outweighing fears of a US debt default.
The Dow Jones Industrial Average slipped 35.27 points, or 0.11 percent, to settle at 32,764.65 points. The S&P 500 Index added 36.04 points, or 0.88 percent, to end at 4,151.28 points. The Nasdaq Composite Index jumped 213.93 points, or 1.71 percent, to close at 12,698.09 points.
Six of the 11 major S&P 500 sectors ended in the red, with energy and utilities leading the declines, shedding 1.89 percent and 1.38 percent, respectively. Meanwhile, the technology and communication services sectors led the gainers with gains of 4.45 percent and 0.43 percent, respectively.
The tech-heavy Nasdaq surged after chip maker Nvidia issued an encouraging sales forecast due to growing demand for artificial intelligence technology. Nvidia shares jumped 24.37 percent, driving other stocks related to AI, which was the main theme driving the market on Thursday (5/25).
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Meanwhile, negotiations between US President Joe Biden and congressional leaders continued on Thursday (5/25), with the Republican party’s top representative telling reporters that the list of issues dividing the two sides was getting smaller.
Biden said at a White House event that he and House Speaker Kevin McCarthy “had some productive conversations” and “our staff continues to meet.” These remarks came a day after rating agency Fitch warned about a possible downgrade of the US credit rating.
“Rating Watch Negative reflects increased political partisanship preventing a resolution to raise or suspend the debt limit,” Fitch said.
Fitch said it still expects a debt limit resolution before the X-date when the US Treasury exhausts its cash position and capacity for extraordinary measures without incurring new debt.
“Wall Street took a very short break from debt ceiling/fed tightening anxiety and focused on Nvidia’s AI boom. The Nasdaq rallied as Nvidia’s outlook supported bets that AI will be key to the mega-cap tech growth story,” said Edward Moya, senior market analyst at OANDA, a supplier of multi-asset online trading services.
