Most US stocks rise as oil prices ease, but slumping AI stars weigh on Wall Street
NEW YORK (AP) — Stocks that have been artificial-intelligence winners are giving back some of their big recent runs on Thursday, leaving the U.S. market mixed as oil prices ease.
The S&P 500 slipped 0.1% a day after dropping from its all-time high and coming just short of its longest winning streak in three decades. The Dow Jones Industrial Average was up 720 points, or 1.4%, as of 10:15 a.m. Eastern time, and the Nasdaq composite was 0.7% lower.
Most stocks on Wall Street rose, aided by a 2.9% drop for the price of Brent crude oil, the international standard, to $94.96 per barrel. That gave back a chunk of its climb this week caused by the latest flare-ups of fighting between Iran and the United States and its allies.
The hope and general expectation on Wall Street seems to be that the United States and Iran will ultimately agree to reopen the Strait of Hormuz to oil tankers. That would improve the global flow of crude and hopefully lower its price. Such hopes, along with strong profit reports from U.S. companies, helped launch the S&P 500 on a nine-day winning streak that ended Wednesday.
Toro added 1.4% Thursday after the seller of mowers and other equipment became the latest U.S. company to deliver better profit and revenue for the latest quarter than analysts expected. CEO Richard Olson said Toro saw strong demand across its products, and the company raised its forecasts for revenue and profit over its full fiscal year.
Several other companies also joined the long list of those topping analysts’ profit expectations, but many dropped nevertheless, particularly in the high-flying technology industry.
Broadcom sank 14.5%, even though both profit and revenue for the chip company surpassed analysts’ expectations. CEO Hock Tan said its AI semiconductor revenue more than doubled to $10.8 billion during the quarter and that demand is only getting bigger. He is forecasting AI semiconductor growth to top 200% in the current quarter.
Investors, though, may have been expecting even more after Broadcom’s stock came into the day with a 38.5% surge for the year so far. That towered over the already strong 10.3% rise for the S&P 500 index, and Broadcom has grown to become Wall Street’s sixth-biggest stock and one of its most influential.
Analysts have been saying AI stocks may have run too high, becoming too expensive, and that the broad U.S. stock market may be set for a slowdown following an unrelenting streak of nine straight winning weeks for the S&P 500, its longest since 2023.
Other AI winners likewise gave back some of their big gains. Marvell Technology sank 4.6% after soaring 47% through the start of the week. Micron Technology, the latest company to see its total value top $1 trillion because of AI euphoria, fell 8.1%.
CrowdStrike Holdings dropped 7.9% even though the cybersecurity company’s profit and revenue for the latest quarter topped analysts’ expectations. CEO George Kurtz said the latest quarter was when “the worlds of cybersecurity and frontier AI collided,” and the company said it’s splitting its stock to make its share price more affordable.
But its stock came into the day with a 59.5% surge for the year so far. And analysts said it beat forecasts for some financial measures by less than it usually does.
Outside of tech, PVH Corp., the company behind the Calvin Klein and Tommy Hilfiger brands, tumbled 24.7% even though it also beat Wall Street’s first-quarter sales and profit targets. CEO Stefan Larsson warned that it’s feeling “the prolonged effects of the Middle East conflict, which is putting pressure on” customers in the region.
In the bond market, Treasury yields eased with oil prices. The yield on the 10-year Treasury fell to 4.45% from 4.49% late Wednesday. That can lessen the pressure on not only stock prices but also the economy in general.
High yields worldwide are threatening to slow economies and undercut prices for stocks and all kinds of other investments. They have already forced the average long-term U.S. mortgage rate to its most expensive level in nine months, and they could curtail companies’ borrowing to build the artificial-intelligence data centers that have supported the U.S. economy’s growth recently.
Reports on the U.S. economy, meanwhile, came in mixed. One said that slightly more U.S. workers applied for unemployment benefits last week, which could indicate a slowdown in what's been a relatively solid job market. Another report said that productivity for U.S. workers improved by less during the first three months of the year than economists expected.
In stock markets abroad, indexes ticked higher in Europe following a weaker finish in Asia.
South Korea’s Kospi fell 1.8%, Hong Kong’s Hang Seng dropped 1.5% and Japan’s Nikkei 225 fell 1.4% for some of the larger losses.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
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