Stocks are holding firm after a big rally on Monday. Crude oil is pulling back further, gold and silver are dipping, and Treasuries and the dollar are flat.
Call it AI Trade Redux! Stocks ripped yesterday, led by all the AI-levered and technology names that performed well earlier in the year. The Nasdaq Composite Index rose 2.2%, more than triple the 0.7% gain in the Dow Jones Industrial Average, while the iShares Semiconductor ETF (SOXX) jumped 4.9%.
AMD (Green), META (Blue) – 1-Month % Change
Source: TradingView
Among individual names, chipmaker Advanced Micro Devices Inc. (AMD) surged 10%, topping $1 trillion in market capitalization for the first time. Meta Platforms Inc. (META) spiked 11% amid optimism that its new Muse AI Agent is seeing strong uptake after debuting earlier in September. The firm hopes Muse is a hit with individuals who can use it to shop, schedule appointments, and perform other tasks for them – helping justify the company's massive AI-related capex spending spree.
One catalyst for the bullish tilt to markets: An ongoing retreat in oil prices. Saudi Arabia reportedly has a workaround plan that would restore oil exports through its East-West pipeline as soon as this week. It’s also trying a few tactics to boost exports through the Strait of Hormuz. Speaking of the Strait, Iran floated the idea of reopening it in seven days if the US eases its naval blockade. That’s spurring tentative optimism about an end to the Middle East conflict.
Lastly, cryptocurrencies are back on track after a rough few months. The total value of digital assets like Bitcoin reclaimed the $3 trillion mark yesterday, according to data from CoinGecko. That’s the highest since January. Open interest in so-called perpetual futures, which traders use to bet on crypto prices, is back around $160 billion – the highest since last October.
