US tech stocks recover after selloff spooks investors over AI spending
Summary
U.S. technology stocks rebounded Tuesday after a brief selloff tied to investor concerns about spending on artificial intelligence. The S&P 500 and Nasdaq rose, while the Dow fell after Apple shares dropped on a weaker-than-expected margin forecast.Key Facts
- The S&P 500 closed up 0.37% and the Nasdaq rose 0.83% on Tuesday.
- The Dow fell 0.38%, while Apple shares lost 1.9% after the company forecast lower margins than expected, citing higher memory-chip costs.
- Nvidia gained 2.3%; Advanced Micro Devices, Broadcom and Micron Technology also rose.
- The Nasdaq had ended Monday 10% below its October 6 record close, a threshold commonly used to define a market correction.
- Brent crude fell to $103 a barrel Tuesday, down from $117 at the end of October.
- For the year so far, the S&P 500 was up 10%, the Nasdaq 9% and the Dow 7%.
- Investors expected Democrats to win at least a House majority and possibly gain Senate seats, which could bring more AI regulation.
- A CNBC analysis of market performance from 1980 to 2024 found that markets often rose after midterm elections, once results became clear.
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