The industry got another boost after Japan’s Hitachi signed a memorandum of understanding with OpenAI related to powering AI. It followed an earlier set of announcements by OpenAI with South Korean companies, which vaulted stock prices higher there. Hitachi’s stock jumped 10.3 per cent in Tokyo.
AI stocks have become so dominant, and so much money has poured into the industry that worries are rising about a potential bubble that could eventually lead to disappointment for investors.
Nvidia, the stock that’s become the poster child of the AI boom, lost an early gain during the morning to finish with a dip of 0.7 per cent.
Applied Materials fell 2.7 per cent. The company, whose equipment helps make semiconductor chips, said it will take a roughly $US110 million ($167 million) hit to its revenue in the fourth quarter because of a new US Commerce Department rule expanding export restrictions to certain customers based in China.
But gains for oil producers helped offset such losses. Exxon Mobil climbed 1.8 per cent, and Diamondback Energy rose 3 per cent as the price of crude clawed back some of its sharp losses from earlier in the week. Oil prices had been struggling on worries that the amount of crude in inventories will be too high relative to demand.
Loading
Entergy climbed 1.9 per cent after saying its Arkansas business will deliver power for Google’s planned $US4 billion investment in the state, including a new data centre.
All told, the S&P 500 added 0.44 to 6,715.79 points. The Dow Jones Industrial Average climbed 238.56 to 46,758.28, and the Nasdaq composite fell 63.54 to 22,780.51.
In stock markets abroad, indexes were mixed across Europe and Asia.
Japan’s Nikkei 225 was a big winner and rose 1.9 per cent thanks in part to Hitachi’s jump.
In the bond market, the yield on the 10-year Treasury rose to 4.12 per cent from 4.10 per cent late Thursday.
Reports came in mixed on activity for US businesses in the health care, real estate and other services industries. One from the Institute for Supply Management said growth is stalling, while another from S&P Global said it’s still growing slowly.
AP
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.