US stocks hold steadier a day after slumping on AI worries
NEW YORK (AP) – The U.S. stock market is holding steadier after getting a reminder that the artificial-intelligence technology boom may also have an upside. The S&P 500 slipped 0.1% Tuesday, a day after sliding 1% amid worries that AI could ultimately make some businesses and industries obsolete. The Dow Jones Industrial Average barely budged, and the Nasdaq composite inched 0.2% lower. AMD helped lead the market after announcing a multi-year deal where it will supply chips to power Meta Platforms’ AI ambitions. IBM recovered a sliver of its drop from the prior day, when worries about AI sent it to its worst loss since 2000.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street appears to be positioned for rebound Tuesday following an artificial intelligence sell-off a day earlier.
Futures for the S&P 500 gained 0.1% while futures for the Dow Jones Industrial Average rose 0.2%. Nasdaq futures were up 0.3% before the opening bell.
Advanced Micro Devices soared more than 10% in premarket after the chipmaker announced that it was expanding its partnership to ramp up Meta’s AI infrastructure. The investment could eventually reach a value of around $100 million, with Meta taking a 10% stake in AMD. Meta fell less than 1%.
On Monday, a report by Citrini Research, a New York financial services company, outlined a future scenario in which AI’s dominance caused the “human-centric consumer economy,” to wither away with dire consequences for employment, was the latest hit to confidence for companies that might be displaced by fast expanding use of the technology.
“Policy response has always lagged economic reality, but lack of a comprehensive plan is now threatening to accelerate a deflationary spiral,” the report says.
A profit report from Nvidia is due on Wednesday. Worries are rising that companies like Alphabet and Amazon may be spending so much on Nvidia’s chips that they’ll never be able to recoup their investments through higher productivity and future profits.
In other equities trading, Home Depot gained 2.4% after it topped Wall Street’s fourth-quarter projections despite ongoing caution from American consumers amid a housing slump.
In Europe at midday, Germany’s DAX edged 0.1% lower, the CAC 40 in Paris ticked up 0.1%. Britain’s FTSE 100 was unchanged.
In Asian trading, Tokyo’s Nikkei 225 index surged 0.9% to 57,321.09. Chip testing equipment maker Advantest rose 4.5%, while machinery maker Disco Corp. added 2.1%.
Markets in mainland China advanced as they reopened following a weeklong holiday, but Hong Kong’s Hang Seng fell as traders locked in profits from recent gains, slipping 1.8% to 26,590.32.
The Shanghai Composite index rose 0.9% to 4,117.41.
In South Korea, the Kospi picked up 2.1% to 5,969.64, setting fresh records on gains for memory chipmaker Samsung Electronics, which jumped 3.6%. SK Hynix, another chipmaker, closed 5.7% higher.
In Australia, the S&P/ASX 200 edged less than 0.1% lower, ending at 9,022.30, while Taiwan’s Taiex gained 2.8%.
India’s Sensex fell 1.3%.
Tuesday will bring President Donald Trump’s State of the Union address, where investors hope the president will clarify U.S. tariff policy going forward after the Supreme Court struck down his sweeping import taxes last week.
In energy trading early Tuesday, U.S. benchmark crude oil gained 11 cents to $66.42 per barrel. Brent crude, the international standard, was up 7 cents at $71.18 per barrel.
Crude prices have been gaining on worries that President Donald Trump might take military action against Iran.
The U.S. dollar rose to 155.86 Japanese yen from 154.66 yen. The euro fell to $1.1777 from $1.1786.
The price of bitcoin fell 4.3% to $63,180.
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