US markets today: Dow climbs to record high as AMD rally fuels AI optimism; Nasdaq slips amid valuation worries
US stocks moved in mixed trade on Wednesday as investors balanced renewed enthusiasm for artificial intelligence (AI) plays with lingering concerns over inflated tech valuations and slowing economic signals. The Dow Jones Industrial Average surged 309 points, or 0.6%, to hit another record, while the S&P 500 dipped 0.1%, staying close to its all-time high. The Nasdaq Composite, weighed down by tech losses, slipped 0.5%, AP reported.Chipmaker Advanced Micro Devices (AMD) led market gains, jumping 9.6% after CEO Lisa Su forecast that the company’s revenue could grow at an annual compounded rate above 35% over the next three to five years, driven by what she called “accelerating AI momentum.” The upbeat outlook gave investors a boost after several volatile sessions for AI-linked stocks.However, analysts said concerns remain that the current rally in artificial intelligence shares mirrors the excesses of the early 2000s dot-com bubble. Nvidia, the sector’s bellwether, oscillated between gains and losses during the session after sliding 4.6% this month. Despite dominating AI chipmaking, its stock’s meteoric rise — doubling in four of the last five years — has left investors debating whether prices have outpaced fundamentals.Wall Street’s broader advance has been fuelled by tech megacaps, even as parts of the US economy show signs of cooling. IBM rose 2.3% after announcing what it called a breakthrough in “bringing truly useful quantum computing to the world,” according to Jay Gambetta, director of IBM Research. The development marks another step in the race among major tech firms to commercialise quantum computing and tackle complex problems traditional systems can’t handle.Elsewhere, On Holdings, the Swiss sportswear company, soared 20.3% after reporting a much larger-than-expected quarterly profit, while Circle Internet Group, a major cryptocurrency issuer, tumbled nearly 10% despite strong earnings. The stock has plunged from almost $300 in June to below $90 amid weakening sentiment toward crypto-linked equities.In the bond market, the yield on the benchmark 10-year US Treasury note eased to 4.06% from 4.13% after trading resumed following Tuesday’s Veterans Day holiday. Lower yields typically make equities more attractive by reducing returns on bonds. Traders continue to price in a roughly two-thirds chance that the Federal Reserve will deliver a rate cut in December, data from CME Group showed.However, Fed Chair Jerome Powell recently cautioned that another cut this year is “far from certain,” warning against fuelling inflation, which remains above the central bank’s 2% target. The Fed’s visibility has also been hindered by the ongoing US government shutdown — the longest in history — which has paused the release of key data on inflation, jobs, and consumer spending. Economists say this data gap complicates policy decisions and adds uncertainty to markets.Globally, equities gained ground. France’s CAC 40 climbed 1.2%, South Korea’s Kospi gained 1.1%, and Japan’s Nikkei 225 advanced 0.4%. In Hong Kong, the Hang Seng Index rose 0.9%, while China’s Shanghai Composite closed nearly flat.Analysts said investor sentiment remains cautiously optimistic as hopes of an imminent end to the US shutdown and expectations for AI-led growth continue to counterbalance valuation concerns in tech-heavy sectors.
