Alphabet and AI stocks nudge Wall Street to more records
NEW YORK--Wall Street inched to more records on Thursday as gains for Alphabet and artificial-intelligence stocks helped make up for Tesla 's steep tumble.
The S&P 500 added 0.1% to its all-time high set the day before. The Dow Jones Industrial Average fell 316 points, or 0.7%, while the Nasdaq composite rose 0.2% to its own record.
Alphabet climbed 1% after the company behind Google and YouTube delivered a fatter profit for the latest quarter than analysts expected. It's leaning more into artificial-intelligence technology and said it's increasing its budget to spend on AI chips and other investments this year by $10 billion to $85 billion.
That helped push up other stocks in the AI industry, including a 1.7% rise for Nvidia. The chip company was the strongest single force lifting the S&P 500 because it's the largest on Wall Street in terms of value.
But an 8.2% drop for Tesla kept the market in check. Elon Musk's electric-vehicle company reported results for the spring that were roughly in line with or above analysts' expectations, and Musk is trying to highlight Tesla's moves into AI and robotaxis.
The focus, though, remains on how Musk's foray into politics is turning off potential customers, and he said several rough quarters may be ahead as 'we're in this weird transition period where we'll lose a lot of incentives in the U.S.'
Stocks have broadly been rallying for weeks on hopes that President Donald Trump will reach trade deals with other countries that will lower his stiff proposed tariffs, along with the risk that they could cause a recession and drive up inflation. The record-setting gains have been so strong that criticism is rising about how expensive stock prices have become. That in turn puts pressure on companies to deliver solid growth in profits in order to justify their gains.
Chipotle Mexican Grill also helped weigh on the market despite delivering a profit for the spring that topped analysts' expectations. The restaurant chain's growth in revenue came up short of expectations, and its stock fell 13.3%.
IBM dropped 7.6% even though it likewise reported a stronger profit than expected. Analysts pointed to slowing growth in its software business, among other things underneath the surface.
American Airlines lost 9.6% despite reporting a stronger profit than expected. The company said it expects to report a loss for the summer quarter. It also gave a forecast for full-year results that had a wide range: between a loss of 20 cents per share and a profit of 80 cents per share, depending on how the economy performs.
Reactions in the stock market have generally been stronger than usual when companies beat or miss their profit targets by a wide margin, according to Julian Emanuel at Evercore.
Other extreme moves have also been roaring underneath the market's surface, including huge swings for 'meme stocks.' Those are stocks where traders are looking to jump in amid online cheerleading and ride it higher, before a halt in momentum leaves some investors holding the bag.
Opendoor Technologies rose 5.7% following a manic stretch where it swung by at least 10%, up or down, in 10 straight days.
Such swings, though, haven't been showing up in overall market indexes, which have been gliding recently. The S&P 500 hasn't had a day where it moved by at least 1% in a month.
All told, the S&P 500 rose 4.44 points to 6,363.35. The Dow Jones Industrial Average fell 316.38 to 44,693.91, and the Nasdaq composite rose 37.94 to 21,057.96.
In the bond market, Treasury yields held relatively steady following the latest signals that the U.S. economy seems to be holding up OK despite pressures from tariffs and elsewhere.
One report said that fewer U.S. workers applied for unemployment benefits last week, a potential signal of easing layoffs. A separate report from S&P Global suggested growth in U.S. business activity accelerated in July, and the preliminary results easily topped economists' expectations.
That helped solidify expectations on Wall Street that the Federal Reserve will hold interest rates steady at its next meeting next week, even though Trump has been agitating angrily for cuts. The European Central Bank, which had earlier been cutting its rates, also held steady on Thursday as it waits to see how Trump's tariffs affect the economy.
The yield on the 10-year U.S. Treasury note briefly approached 4.44% in the morning before pulling back to 4.40%, where it was late Wednesday.
In stock markets abroad, indexes rose across much of Asia and Europe. Tokyo's jump of 1.6% and London's rise of 0.8% were two of the bigger gains.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Japan Today
12 hours ago
- Japan Today
Asian shares trade mostly higher after stocks on Wall Street extend losses
People walk in front of an electronic stock board showing Japan's Nikkei index at a securities firm Friday, Aug. 1, 2025, in Tokyo. (AP Photo/Eugene Hoshiko) By YURI KAGEYAMA Asian shares were mostly higher in muted trading Wednesday, after discouraging signs about the U.S. economy sent Wall Street shares declining, and Investors are sifting through a slew of corporate earnings reports to assess how businesses may have been affected by U.S. President Donald Trump's tariffs. Among Japanese companies, automakers Honda Motor Co. and Toyota Motor Corp. will report fiscal first quarter results this week, as will electronics and entertainment company Sony Corp. Japan's benchmark Nikkei 225 rose 0.6% to finish at 40,794.86. Australia's S&P/ASX 200 added 0.8% to 8,843.70. South Korea's Kospi was little changed, gaining less than 0.1% to 3,198.14. Hong Kong's Hang Seng rose 0.2% to 24,958.75, while the Shanghai Composite gained 0.8% to 3,633.99. U.S. futures were up 0.5%. On Tuesday, the S&P 500 fell 0.5% to 6,299.19, coming off a whipsaw stretch where it went from its worst day since May to its best since May. The Dow Jones Industrial Average dropped 0.1% to 44,111.74, and the Nasdaq composite fell 0.7% to 20,916.55. A weaker-than-expected report on activity for U.S. businesses in services industries like transportation and retail added to worries that Trump's tariffs may be hurting the economy. But conversely such indicators raise hopes the Federal Reserve may cut interest rates. That along with a stream of stronger-than-expected profit reports from U.S. companies helped to keep losses in check. The S&P 500 remains within 1.4% of its record. The pressure is on companies to report bigger profits after the U.S. stock market surged to record after record from a low point in April. The big rally fueled criticism that the broad market had become too expensive. For stock prices to look like better bargains, companies could produce bigger profits, or interest rates could fall. The latter may happen in September, when the Fed has its next policy meeting. Expectations have built sharply for a rate cut at that meeting since a report on the U.S. job market on Friday came in much weaker than economists expected. Lower interest rates would make stocks look less expensive, while also giving the overall economy a boost. The potential downside is that they could push inflation higher. Treasury yields sank sharply after Friday's release of the jobs report, and they haven't recovered. The yield on the 10-year Treasury eased to 4.19% from 4.22% late Monday and from 4.39% just before the release of the jobs report. That's a significant move for the bond market. In energy trading, benchmark U.S. crude rose 57 cents to $65.73 a barrel. Brent crude, the international standard, added 64 cents to $68.28 a barrel. In currency trading, the U.S. dollar edged up to 147.66 Japanese yen from 147.61 yen. The euro cost $1.1575, down from $1.1579. © Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.
Asahi Shimbun
14 hours ago
- Asahi Shimbun
Asian shares trade mostly higher after stocks on Wall Street extend losses
People walk in front of an electronic stock board showing Japan's Nikkei index at a securities firm, Aug. 1, 2025, in Tokyo. (AP Photo) Asian shares were mostly higher in muted trading Wednesday, after discouraging signs about the U.S. economy sent Wall Street shares declining, and as investors are sifting through a slew of corporate earnings reports to assess how businesses may have been affected by U.S. President Donald Trump's tariffs. Among Japanese companies, automakers Honda Motor Co. and Toyota Motor Corp. will report fiscal first quarter results this week, as will electronics and entertainment company Sony Corp. Japan's benchmark Nikkei 225 rose 0.6% to 40,777.45. Australia's S&P/ASX 200 added 0.6% to 8,822.90. South Korea's Kospi lost 0.3% to 3,187.57. Hong Kong's Hang Seng rose 0.2% to 24,947.57, while the Shanghai Composite gained 0.3% to 3,627.54. U.S. futures were up 0.3%. On Tuesday, the S&P 500 fell 0.5% to 6,299.19, coming off a whipsaw stretch where it went from its worst day since May to its best since May. The Dow Jones Industrial Average dropped 0.1% to 44,111.74, and the Nasdaq composite fell 0.7% to 20,916.55. A weaker-than-expected report on activity for U.S. businesses in services industries like transportation and retail added to worries that Trump's tariffs may be hurting the economy. But conversely such indicators raise hopes the Federal Reserve may cut interest rates. That along with a stream of stronger-than-expected profit reports from U.S. companies helped to keep losses in check. The S&P 500 remains within 1.4% of its record. The pressure is on companies to report bigger profits after the U.S. stock market surged to record after record from a low point in April. The big rally fueled criticism that the broad market had become too expensive. For stock prices to look like better bargains, companies could produce bigger profits, or interest rates could fall. The latter may happen in September, when the Fed has its next policy meeting. Expectations have built sharply for a rate cut at that meeting since a report on the U.S. job market on Friday came in much weaker than economists expected. Lower interest rates would make stocks look less expensive, while also giving the overall economy a boost. The potential downside is that they could push inflation higher. Treasury yields sank sharply after Friday's release of the jobs report, and they haven't recovered. The yield on the 10-year Treasury eased to 4.19% from 4.22% late Monday and from 4.39% just before the release of the jobs report. That's a significant move for the bond market. In energy trading, benchmark U.S. crude rose 41 cents to $65.57 a barrel. Brent crude, the international standard, added 42 cents to $68.06 a barrel. In currency trading, the U.S. dollar dipped to 147.34 Japanese yen from 147.61 yen. The euro cost $1.1583, up from $1.1579.
Japan Times
14 hours ago
- Japan Times
Australian watchdog says YouTube, others 'turning a blind eye' to abuse material
Australia's internet watchdog has said the world's biggest social media firms are still "turning a blind eye' to online child sex abuse material on their platforms, and said YouTube in particular had been unresponsive to its inquiries. In a report released on Wednesday, the eSafety Commissioner said YouTube, along with Apple, failed to track the number of user reports it received of child sex abuse appearing on their platforms and also could not say how long it took them to respond to such reports. The Australian government decided last week to include YouTube in its world-first social media ban for teenagers, following eSafety's advice to overturn its planned exemption for the Alphabet-owned Google's video-sharing site. "When left to their own devices, these companies aren't prioritising the protection of children and are seemingly turning a blind eye to crimes occurring on their services,' eSafety Commissioner Julie Inman Grant said in a statement.
