The Dow reached a new all-time high on Thursday, with the S&P 500 also climbing, primarily boosted by UnitedHealth and financial stocks. However, Broadcom’s disappointing results fell short of what investors had hoped for, leading to a downturn in semiconductor stocks and the Nasdaq.
During midday trading, the Dow Jones Industrial Average increased by 912 points, or 1.8%, reaching $51,599. Meanwhile, the S&P 500 saw a modest rise of 0.3%, while the Nasdaq slipped by 0.2%.
Broadcom’s stock plummeted 14% after the company reaffirmed its long-term target of $100 billion in AI chip sales, which didn’t excite investors as anticipated.
The company has seen nearly a 55% increase in its stock this quarter, but if this downward trend continues, its market capitalization could decrease by nearly $320 billion before the trading period ends.
“The results from Broadcom were generally positive, except for the guidance that didn’t align with market expectations,” noted Dustin Thackeray, chief investment officer at Crew Advisors.
“It seems like chip prices are set to steady a bit. They’ve really surged since their lows at the end of March.”
After a shaky start, the S&P 500 began to gain ground as tech stock rotations uplifted the broader market, with nine out of the 11 major S&P sectors making gains.
Blackstone has also recently implemented restrictions on withdrawals from its main private credit fund, due to a spike in redemption requests.
This week saw stock increases on Wall Street stall as investors weighed the rising tensions between the United States and Iran.
Despite a ceasefire agreed upon earlier in April, there’s been minimal advancement in talks to end the conflict and reopen the Strait of Hormuz. Oil prices keep climbing, increasing inflation risks.
Recent weekly jobless claims data indicated that more Americans filed for unemployment than anticipated last week, ahead of Friday’s more extensive monthly jobs report.
This data could provide new Federal Reserve Chairman Kevin Warsh with valuable insights into the U.S. labor market as he approaches his first policy meeting this month amid consumer pressures stemming from the situation in Iran.
Traders currently estimate a 75% likelihood of a 25 basis point interest rate hike by the end of the year, according to LSEG data.
In other market movements, CrowdStrike saw an 8.5% decrease after the cybersecurity company reported increased operating costs in the first quarter.
Additionally, SpaceX, led by Elon Musk, is set to kick off an investor roadshow on Thursday ahead of its June 12 market debut. The company successfully raised $75 billion in an unprecedented IPO, which positions it with a valuation of $1.75 trillion, aiming to be among the top 10 publicly traded companies in the U.S.
