Wall Street reached new highs, driven by enthusiasm for the artificial intelligence (AI) industry. The S&P 500 rose 0.4% to an all-time high, while the Nasdaq gained 0.7%. Advanced Micro Devices (AMD) surged 23.7% after a deal with OpenAI, which may involve owning up to 160 million shares of AMD based on performance milestones. However, concerns about inflated AI valuations are emerging as OpenAI’s worth reaches $500 billion.
Meanwhile, Nvidia’s stock fell 1.1% after announcing a $100 billion investment in OpenAI, raising concerns about potential circular investments in AI. In other notable movements, Comerica shares jumped 13.7% due to its acquisition by Fifth Bancorp, while Tesla rose 5.4% following speculation about upcoming product announcements. Conversely, Verizon’s stock dipped 5.1% after a CEO change.
Internationally, Japanese stocks rallied following political shifts, while French stocks fell amid political instability. In bond markets, the yield on 10-year Treasuries increased to 4.16%. The U.S. government shutdown is expected to impact upcoming economic reports, but many investors remain optimistic about the Federal Reserve’s future interest rate decisions.
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