Traders work on the floor of the New York Stock Exchange (NYSE) in New York City.
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The Dow Jones Industrial Average rose on Tuesday as a number of upbeat earnings reports and a drop in oil prices overshadowed recent pressure seen among artificial intelligence-related stocks.
The blue-chip index gained 523 points, or 1%, while the S&P 500 added 0.4%. The Nasdaq Composite traded up 0.2%.
Shares of industrial and safety products producer 3M offered a boost to the Dow, jumping more than 5% following better-than-expected earnings results and a full-year guidance raise. Shares of aerospace and defense company Northrop Grumman also advanced 6% after it posted an earnings beat.
Meanwhile, oil prices pulled back from earlier gains, helping investor sentiment. U.S. West Texas Intermediate crude futures were last down less than 1% at around $103 per barrel, while Brent crude futures fell more than 1% to roughly $107 a barrel. The moves in oil, which added to the declines in Treasury yields, come as traders continued to monitor developments in the Middle East.
The market has been weighed down as of late by worries about the sustainability of the AI trade, as debt and demand concerns grow. In fact, sentiment in tech took a hit earlier in the day after Korean AI firm Elice tumbled more than 30% overnight in its public market debut. Asia-Pacific markets declined Tuesday, after U.S. stocks rose overnight, leading to declines in the South Korean market.
However, AI-related stocks staged a bit of a comeback as the session went on. Micron Technology, Intel and Sandisk all rose around 1%. Seagate Technology, and Advanced Micro Devices were up 2% and more than 1%, respectively. The VanEck Semiconductor ETF (SMH) added nearly 1%, while CoreWeave gained more than 2%.
The S&P 500 climbed 0.4% in regular trading on Monday, while the Nasdaq Composite advanced more than 1%. Nvidia added 1.4%, and Tesla jumped 3.8%. Alphabet shares advanced about 1%. That marked a rebound from last week’s rout, which spilled over into the broader market, as concerns grew around companies borrowing too much money for their AI build-outs.
“Improving moods regarding the prospects of modern technology have Wall Street breathing a sigh of relief as participants drop hedges, after the cost of volatility protection soared intraday on Friday, ahead of the intensifying selloff,” wrote Jose Torres, senior economist at Interactive Brokers.
