Wall Street Holds Its Breath Amidst Trade Discord and Saudi AI Influence
Artificial Intelligence stocks rebound following Trump's visit to Saudi Arabia.
Street talk is abuzz as the glimmer of Sino-US trade peace gradually fades away, putting traders on Wall Street in a state of suspense. Cues are streaming from the recent Middle Eastern exploration of the US President.
After two days of mixed results, Wall Street took a moment's rest in the heart of the week. The Dow Jones Index ended 0.2% in the red at 42,051 points, while the S&P-500 moved up 0.1%, and the Nasdaq Composite pushed ahead by 0.7%.
Trade tussles between the US and China remain the center stage, though hints of easing post the weekend are evident. Alas, there's still no trace of negotiations on future tariff levels. With the originally sky-high tariffs expected to resurface after 90 days, the clock's ticking, sources say.
Tech giant Cisco was under the microscope as investors awaited the Q3 results, slated to be announced following market hours. "Positive sentiments swirl around Cisco given indicators of robust demand in data center and enterprise tech segments, robust capital returns, and a moderate valuation, albeit some margin impacts due to tariffs are likely imminent," remarked Vital Knowledge analysts. Cisco's stock slid 0.8% before the results were released.
Meanwhile, stocks with AI leanings caught the eyes of investors, following Saudi Arabia's declaration of a $20 billion investment in AI data centers and energy infrastructure from the US. Nvidia (4.2%) and AMD (4.7%) enjoyed yet another boost due to the collaboration announced yesterday with Saudi Arabian Humain, a subsidiary of the state-owned investment fund. AMD additionally declared an additional share buyback. Super Micro Computer surged 15.7%. The AI server manufacturer has entered into a partnership with the Saudi Arabian Datavolt.
Apple's stock took a minor dip. Foxconn tallied a substantial increase in profits in the first quarter but reduced its sales predictions due to tariff concerns. Foxconn, the world's leading electronics contract manufacturer, famous for assembling Apple's iPhones, benefited from various factors, including customer initiatives to rush deliveries to the US ahead of potential US import tariffs. Foxconn also plays a growing role in crafting AI servers for US tech titans like Amazon and Nvidia.
Boeing (0.7%) and GE Aerospace (0.7%) benefited from an order from Qatar. According to the White House, Qatar Airways placed orders for aircraft and engines from the two companies worth $96 billion.
American Eagle Outfitters released preliminary results for the first quarter, showing a disappointing balance, and withdrew its guidance for fiscal year 2025. Its stock dropped 6.5%.
The Dollar Steady, Oil Eases
The greenback found its footing after its recent tumble. However, foreign exchange analyst Thu Lan Nguyen of Commerzbank noted that the dollar continues to face stress following US President Donald Trump's call for rate cuts after the latest underwhelming US inflation data. Trump reiterated his displeasure with the speed of the rate cuts on his Truth Social platform. Initially, the dollar's descent after the data seems logical given the prospect of faster rate cuts, Nguyen said. However, it might also reflect Trump's satisfaction with the lack of tariff impact in the data.
Oil prices eased after recent powerful surges. Brent and WTI futures slipped by up to 1.3% after US oil inventories unexpectedly rose. Oil had been bolstered by easing US-China tensions. "Any deterioration in market sentiment towards trade talks could challenge the recent rally," said Investec analyst Callum Macpherson.
The gold price plummeted sharply. The troy ounce shed 2.1% to $3,181. This drop was largely due to lower demand for "safe havens." In the bond market, yields dipped. The yield on 10-year notes decreased 4 basis points to 4.54%. Mark Capleton of Bank of America anticipates yields to continue to rise as foreign investors grow less willing to finance the US deficit. Diminished demand for US bonds could push their yields higher.
For more on today's market dynamics, delve deeper here.
Source: ntv.de, ino/rts
- Stock performance
- Trade war
- Cisco
- Dow Jones
- Wall Street
- In the realm of European Countries, a critical discussion about employment policies is escalating, given the potential impact of trade disputes and financing for technological investments on business growth.
- Amidst the ongoing trade war between the US and China, the performance of the US stock market, such as the Dow Jones Index, S&P-500, and Nasdaq Composite, is under close scrutiny by investors, with certain sectors like data center technology and AI-oriented companies gaining attention.
- As market focus shifts towards employment policies and tech investments, the finance sector is keeping a watchful eye on important events such as tech giant Cisco's Q3 results, the impact of AI investments in companies like Nvidia and AMD from Saudi Arabia, and news about tariff levels between trade-warring countries, all of which may have widespread implications for general-news, stocks, and the overall economy.
