A rally in technology companies lifted stocks ahead of results from industry giants valued at more than $10 trillion, with traders also bracing for the Federal Reserve rate decision.
Despite losses in most of its companies, the S&P 500 advanced. A closely watched gauge of chipmakers climbed 2.3%. Meta Platforms Inc.’s $25 billion stock sale was said to have attracted demand for about five times the available shares. Brent crude dropped below $115. Treasuries wavered.
Investor enthusiasm around artificial intelligence returned after the trade took a drubbing over the past few weeks amid concerns about the amount of debt fueling the infrastructure buildout.
Three of the world’s biggest companies — Alphabet Inc., Microsoft Corp. and Amazon.com Inc. — are expected to show healthy growth when they report earnings this week. But for Wall Street, what really matters these days is: How much money they’re spending on AI and when it will start to pay off in a meaningful way.
“It’s going to be very interesting to see how these stocks react to their earnings/guidance,” said Matt Maley at Miller Tabak. “So far, many tech names have sold off following their reports. Therefore, given how important these companies are to the AI phenomenon, their reactions should be particularly important.”