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US Stocks Rise, Recover Some Losses 06/29 15:25
U.S. stocks rose Monday and recovered some of their losses from a rare
losing week.
NEW YORK (AP) -- U.S. stocks rose Monday and recovered some of their losses
from a rare losing week.
The S&P 500 climbed 1.2% and broke a five-day losing streak. It was coming
off just its second losing week in the last 13. The Dow Jones Industrial
Average added 306 points, or 0.6%, and the Nasdaq composite rallied 2.1%.
Several stocks boosted by the artificial-intelligence boom rose after
Samsung Electronics and SK Hynix said they will invest roughly $518 billion in
a new chipmaking hub in South Korea, as its president hopes to capitalize on
surging AI demand.
Applied Materials, whose equipment helps make semiconductors, rallied 10.8%
to vault its gain for the year so far above 170%.
AI stocks have been on a roller-coaster ride recently after soaring to
tremendous heights. They're under pressure because of worries that their
profits can't possibly keep pace with the huge gains for their stock prices.
And the moves have an outsized effect on investors because AI stocks have
become some of Wall Street's largest and most influential, giving them more
weight on indexes than others.
Nvidia was one of the strongest forces lifting the S&P 500, for example,
after its stock rose 1.3%. That's because it's Wall Street's biggest stock with
a total value of more than $4.7 trillion.
SpaceX, which owns the xAI business along with rockets, has already become
worth more than $2 trillion after its stock's ballyhooed debut on the Nasdaq
earlier this month, with sharp rises and falls along the way. It's become big
enough that Nasdaq said Elon Musk's company will join the Nasdaq 100 index
before trading begins on July 7, which will force funds tracking the index to
buy the stock.
SpaceX climbed 7.2%.
Outside of AI, Comcast rose 4.5% after saying it will split off its
NBCUniversal media business and Sky from its broadband and wireless business.
Its stock came into the day with a loss of 17.3% for the year so far.
That helped offset a 5.2% drop for Verizon Communications, which said it's
paying $625 million as part of a deal to combine its international wireline
connectivity and managed network services business with some of London-based BT
Group's subsidiaries in a joint venture.
All told, the S&P 500 rose 86.41 points to 7,440.43. The Dow Jones
Industrial Average added 306.63 to 52,182.74, and the Nasdaq composite rallied
522.53 to 25,820.14.
The gains for the stock market came even though oil prices rose. The price
for a barrel of Brent crude, the international standard, climbed 1.8% to
$73.91, pulling back above where it was before the war with Iran began.
Benchmark U.S. crude for August delivery rose 2.2% to settle at $70.75 per
barrel.
Following attacks across the Persian Gulf over the weekend, the United
States and Iran on Monday separately announced they will send delegations to
Qatar this week, though Tehran insisted it has not agreed to meet with the
United States "at any level."
The hope is that an end to the war with Iran will give oil tankers full
access again to the Strait of Hormuz, allowing them to exit the Persian Gulf
and deliver crude to customers worldwide. That would help lower the price of
oil, whose jumps because of the war have sent a punishing wave of inflation
around the world.
If oil prices do recede and stay low enough, it could keep enough pressure
off inflation to allow the Federal Reserve and other central banks to keep
interest rates steady or even cut them instead of hiking them.
Higher interest rates can keep a lid on inflation, but they also slow the
economy and hurt prices for all kinds of investments. High yields worldwide
have been rattling investors after oil prices burst above $100 per barrel
because of the war.
The yield on the 10-year Treasury edged down to 4.37% from 4.38% late Friday
and from 4.56% early this month.
In stock markets abroad, indexes dipped modestly in Europe following mixed
performances in Asia.
Stocks jumped 1.6% in Hong Kong and 1.2% in Shanghai for two of the world's
biggest gains, while South Korea's Kospi slipped 0.2%.
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