AI/ Wall Street/ stock market/ Salesforce/ Marvell Technology/ Fed rate cuts/ global markets/ NEW YORK/ Newslooks/ J. Mansour/ Morning Edition/ U.S. stocks continued their upward trajectory Wednesday, driven by optimism around artificial intelligence boosting corporate profits. The S&P 500 rose 0.3% in early trading, positioning it for another record-breaking year. Tech giants like Salesforce and Marvell Technology led the rally, while weaker-than-expected retail earnings from Foot Locker highlighted ongoing challenges for consumer spending.
Market Highlights: Quick Looks
- Major Index Performance:
- S&P 500 up 0.3%, nearing its 56th record high this year.
- Dow Jones rose 312 points (0.7%), Nasdaq added 0.6%.
- Tech Sector Strength:
- Salesforce: Shares surged 10% on strong AI-driven revenue performance.
- Marvell Technology: Up 17.7% after forecasting stronger AI-related demand.
- Retail Sector Weakness:
- Foot Locker: Fell 17% due to disappointing earnings and cautious forecasts.
- Economic Updates:
- ADP report indicated slower private-sector hiring growth.
- Fed likely to cut rates in December but faces uncertainty with Trump’s election.
- Global Markets:
- South Korea’s Kospi: Down 1.4% amid political unrest following martial law declaration.
- France’s CAC 40: Up 0.9% despite political tensions over a no-confidence vote.
AI-Driven Gains Propel Wall Street Toward New Records
Deep Look
AI Powers Market Gains
Wall Street’s rally continues to be fueled by advancements in artificial intelligence, with companies highlighting AI’s transformative impact on operations. Salesforce CEO Mark Benioff called AI a revolution in global labor, as the company’s revenue outperformed expectations. Marvell Technology similarly benefited, with its CEO citing robust AI-driven demand.
Together, these tech-driven gains offset weaknesses in the retail sector, where Foot Locker reported disappointing results due to soft consumer demand outside of peak shopping periods.
Consumer Spending and Economic Indicators
U.S. shoppers remain pivotal to economic stability, helping the country avoid a recession despite high interest rates. However, rising prices and a slowing job market are pressuring spending. Friday’s upcoming jobs report is expected to provide clearer insights into the labor market’s health.
ADP’s latest report indicated private-sector hiring growth slowed in November, reinforcing expectations that the Federal Reserve will cut its key interest rate at its December meeting. However, President-elect Donald Trump’s return to the White House may alter economic expectations, as his policies could increase both growth and inflation.
Global Developments Impact Markets
- South Korea: The Kospi dropped 1.4% following dramatic political events, including President Yoon Suk Yeol’s brief declaration of martial law. Samsung Electronics, a major market player, slipped 0.9%.
- France: Despite rising political tensions over a budget-related no-confidence vote, the CAC 40 climbed 0.9%.
Bond Market Movements
The yield on the 10-year Treasury rose to 4.26% from 4.23% the previous day, reflecting cautious optimism amid shifting economic conditions.
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