Wall Street Boosted by AI as Bond Market Moves Shook Markets
While global markets were shaken by sharp fluctuations in bond yields, Wall Street recovered its losses thanks to strong artificial intelligence optimism and positive earnings reports.
Fluctuations in the bond markets were felt across global stock markets, with a rise in US bond yields and declines in Europe drawing attention. In contrast, the boom in artificial intelligence technology and strong corporate earnings led to the recovery of losses on Wall Street and Asian stock exchanges.
Global Markets and European Stock Exchanges
While volatility in the bond market continued to shake global stock markets, movements on Wall Street remained relatively modest on Thursday. In Europe, indices fell by 1.7% in London, 1.6% in Paris, and 1% in Frankfurt.
Sharp changes in bond yields played a role in these declines in Europe. The yield on the 10-year French government bond surged to near 4.95% before following a volatile course and rising again.
Bond Yields and Oil Prices
High bond yields make borrowing expensive, slowing down the economy and keeping prices of stocks and other investments under pressure. Inflation concerns and a strong US economy play a role in the rise of yields.
The price of a barrel of Brent crude oil increased by 4.4% to reach $102.31, driven by uncertainties surrounding Iran.
US Economy and Bond Yields
While it was reported that the US economy continues to remain strong despite challenges, jobless claims declined and growth in the manufacturing sector continued in September.
The yield on the 10-year US Treasury note retreated to 5.23% after heading toward 5.34%, its highest level since 2002.
Artificial Intelligence and Tech Stocks
On Wall Street, stocks that benefited from the artificial intelligence technology boom stood out. Micron Technology's strong earnings report, which exceeded analysts' expectations, boosted optimism in the AI industry.
Micron shares gained 3%, while Nvidia jumped 1.1%, Applied Materials 3.5%, and Accenture 15.8%.
Stock Indices and Asian Markets
At the end of the day, the S&P 500 index rose 14.91 points to 7,666.45, the Dow Jones Industrial Average rose 20.51 points to 50,926.56, and the Nasdaq composite rose 10.53 points to 26,871.60.
In Asian markets, Japan's Nikkei 225 index rose 3.3% and South Korea's Kospi index increased by 1.9% thanks to artificial intelligence optimism.