NEW YORK (AP) — U.S. stocks drifted around their records in a mixed day of trading Wednesday.
The S&P 500 added 0.1% and neared its all-time high set a couple weeks ago. The Dow Jones Industrial Average
jumped 327 points, or 0.7%, to set a record for the second straight day, while the Nasdaq composite slipped 0.3%.
Advanced Micro Devices was at the front of the market. It rallied 9% after CEO Lisa Su said the chip company is expecting better than 35% of annual compounded revenue growth over the next three to five years. She credited “accelerating AI momentum.”
Stocks benefiting from the artificial-intelligence frenzy have been shaky recently, as investors question whether how much more they can add to already spectacular gains.
Their sensational performances have been one of the top reasons the U.S. market has hit records despite a slowing job market and high inflation. Their prices have shot so high, though, that critics say they’re reminiscent of the 2000 dot-com bubble, which ultimately burst and dragged the S&P 500 down by nearly half.
Nvidia came into the day with a 4.6% drop for the month so far, for example, after its stock price more than doubled in four of the last five years. The biggest player in AI chips swung between gains and losses throughout Wednesday. Palantir Technologies, another AI darling, fell 3.6% for one of the day’s larger losses in the S&P 500.
Similar questions about priciness are dogging the rest of the U.S. market, though not as pointedly as for Big Tech and AI superstars.
One way for stock prices to look less expensive is for companies to deliver big growth in profits.
On Holdings jumped 18% after the Swiss shoe and apparel company reported a much bigger profit for the latest quarter than analysts expected. It reported growth in sales from around the world, with the strongest coming from Asia.
But even beating expectations may not be enough for some stocks. Circle Internet Group fell 12.2% even though it reported profit for the latest quarter that trounced analysts’ estimates.
The issuer of one of the most popular cryptocurrencies has seen its stock price fall since it got near $300 in June, just a few weeks after its initial price offering of $31. It’s now below $87.
All told, the S&P 500 rose 4.31 points to 6,850.92. The Dow Jones Industrial Average climbed 326.86 to 48,254.82, and the Nasdaq composite slipped 61.84 to 23,406.46.
Another way for stock prices to look less expensive is if interest rates fall. That’s because bonds paying lower yields can encourage investors to pay higher prices for other kinds of investments.
In the U.S. bond market, the yield on the 10-year Treasury eased to 4.06% from 4.13% late Monday after trading resumed following Tuesday’s Veterans Day holiday.
Traders still see a nearly 2-in-3 chance that the Federal Reserve will cut its main interest rate at its next meeting in December, according to data from CME Group. That’s despite Fed Chair Jerome Powell saying a third cut for the year is far from a sure thing. Fed officials are worried about the potential of giving still-high inflation more fuel.
The Fed has been in a difficult spot recently because the U.S. government has not been publishing its usual updates on the job market, inflation and other areas of the economy. That’s restricted its view of how things are going, though the nation’s longest-ever shutdown appears to be nearing an end.
In stock markets abroad, indexes rose across much of Europe and Asia.
Germany’s DAX returned 1.2%, and South Korea’s Kospi jumped 1.1% for two of the world’s bigger gains.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
