By Chibuike Oguh
NEW YORK, June 25 (Reuters) – Global stocks rose on Thursday as strong earnings from chipmakers lifted sentiment, although investors remained wary about stretched valuations for AI-related shares, while the dollar hovered near a one-year high.
The benchmark S&P 500 ended flat while the Dow rose on Wall Street, led by industrials, healthcare and materials stocks.
Micron was up 15.7% after the memory chipmaker’s solid forecast helped to extend its AI-driven ascent.
Qualcomm rose 3.8% after reporting that it expects $15 billion a year in sales from its data center business by 2029.
The Nasdaq closed down, however, pulled lower by choppy trading among most megacap technology stocks. Apple lost 6.1% while Microsoft shed 3.5%.
The Dow Jones Industrial Average rose 0.14%, the S&P 500 ended flat, and the Nasdaq Composite fell 0.46%.
AI VALUATIONS, INTEREST RATES DRIVE SENTIMENT
Investor concern that valuations of AI-related companies have become stretched after years of gains has weighed on markets in recent days, leading to volatile sessions.
Markets are also pricing in higher interest rates from the U.S. Federal Reserve and other central banks.
“If you took the tech sector alone against the S&P 500 excluding technology going back to 2000, we are about 2.8 standard deviations away from the average,” said Marc Dizard, chief investment officer at Huntington Wealth Management.
“When you get the magnitude of that move, it’s not surprising to us that we would get a little bit of a pause, some consolidation and rebalancing where investors are taking profits off the table.”
In Europe, the broad STOXX 600 rose 0.80%. MSCI’s gauge of stocks across the globe rose 0.37%.
“Technology is a long-duration asset as the story plays out, not necessarily in the next six months. And when you have the Fed come out with a more hawkish tone, long-duration assets are going to sell off in that time period,”…
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