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US Stocks Rise Tuesday 02/24 15:24
U.S. stocks rose Tuesday after getting a reminder that the
artificial-intelligence boom may also have an upside.
NEW YORK (AP) -- U.S. stocks rose Tuesday after getting a reminder that the
artificial-intelligence boom may also have an upside.
The S&P 500 climbed 0.8% and recovered nearly three-quarters of its sharp
drop from the day before. The Dow Jones Industrial Average added 370 points, or
0.8%, and the Nasdaq composite gained 1%.
Advanced Micro Devices helped lead the market and rallied 8.8% after
announcing a multiyear deal where it will supply chips to Meta Platforms to
help power its AI ambitions. Under the agreement, Meta also got the right to
buy up to 160 million shares of AMD stock for 1 cent each, depending in part on
how many chips Meta ultimately buys.
It's a reminder of the excitement that built in recent years about the
billions of dollars pouring into AI, which could remake the world and create a
more productive economy.
It also helped produce a sharp turnaround from the prior day, when worries
about the potential downsides of AI shook Wall Street, particularly companies
and industries that investors fear could be made obsolete. Industries as far
flung as software, trucking logistics and financial services have recently seen
investors suddenly and aggressively punish them for potentially being under
threat.
IBM rose 2.7% to recover some of its 13.1% drop from Monday, which was its
worst since 2000.
The pain has also filtered out to the private-equity industry, with fears
building that loans it made to software companies dependent on recurring
revenue may have less of a chance of getting repaid. Blue Owl Capital rose 2.8%
to trim its loss for the young year so far to 28.2%.
On Tuesday, Anthropic unveiled new tools for businesses to use with its
Claude AI assistant. They covered everything from human-resources work to
engineering to investment banking.
The event suggested that fears about AI supplanting existing software,
rather than merely making it easier to use, may be overblown, according to Dan
Ives, an analyst at Wedbush. "While these use cases are impressive, the reality
is that these new AI tools will not rip and replace existing software
ecosystems and data environments with these AI tools only as useful as the data
it can reach."
One of the tools allows users to bring data on financial markets from
FactSet into Claude. FactSet Research Systems' stock jumped 5.9% for one of the
biggest gains in the S&P 500, though it's still down 30.6% for the year so far.
Other companies hit hard by worries about AI competition also trimmed their
losses for the year. Salesforce climbed 4.1%, and AppLovin rose 3.3%.
Outside of AI worries, big U.S. companies continued to report mostly better
profits for the end of 2025 than analysts expected.
Keysight Technologies rallied 23.1% for the biggest gain in the S&P 500
after topping analysts' expectations for profit and revenue in the latest
quarter. It also said revenue in the current quarter could rise by roughly 30%
from a year earlier.
Home Depot rose 2% after likewise delivering stronger profit and revenue
than analysts expected. That was even with what CEO Ted Decker called "ongoing
consumer uncertainty."
All told, the S&P 500 rose 52.32 points to 6,890.07. The Dow Jones
Industrial Average added 370.44 to 49,174.50, and the Nasdaq composite climbed
236.41 to 22,863.68.
In stock markets abroad, indexes were mixed in Europe amid mostly modest
movements.
The swings were larger in Asia. South Korea's Kospi jumped 2.1%, while Hong
Kong's Hang Seng dropped 1.8%. Stocks in Shanghai rose 0.9% after reopening
following a holiday of more than a week.
In the bond market, Treasury yields held relatively steady after a report
said that confidence among U.S. consumers improved by more than economists
expected. The yield on the 10-year Treasury held at 4.03%, where it was late
Monday.
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