The S&P 500 and Nasdaq Composite rose Tuesday midday after cooler-than-expected inflation data reduced bets on an October rate hike. Investors now turn to Micron Technology's after-the-bell earnings for signals on the AI boom, while Robinhood and Moderna moved sharply on company-specific news.
Stocks climbed through midday Tuesday as investors welcomed a softer Personal Consumption Expenditures reading for August, then turned their attention to Micron Technology's earnings after the close.
S&P 500, Nasdaq rise on inflation data
As of 11:37 AM ET, the Nasdaq Composite climbed 1.02% to 27,072. The S&P 500 gained 0.58% to 7,715, and the Dow Jones Industrial Average slipped 0.03% to 51,336 following the softer-than-expected inflation data.
August's Personal Consumption Expenditures price index showed a 3.4% gain year-on-year, lower than expected. As a result, traders reduced their expectations of an October rate hike. Gold slipped 0.60% to $4,157.79. The 10-Year Treasury yield rose 2 basis points to 5.28%. Communication and utilities led the session's gainers, while financial services and consumer defensive stocks underperformed.
Investors await Micron earnings
Robinhood Markets fell despite a positive analyst reaction to the launch of its AI-driven strategy tools. Meanwhile, investors are watching sector bellwether Micron Technology, which reports earnings after the bell for guidance on the sustainability of the AI boom. Moderna, however, tumbled over 7% after a Citi downgrade.
Concentration risk back in focus
Concentration risk is back in the spotlight: if a couple of big AI hyperscalers slip, it could have an oversized impact on the rest of the market. Major U.S. indexes sit near all-time highs and appear relatively calm, but single-stock volatility is rising. Market breadth — the ratio of winning to losing stocks — is deteriorating, which keeps diversification and risk management in focus.
Source: The Motley Fool
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