US stocks experienced an upward trend on Tuesday as investors closely monitored developments in artificial intelligence (AI), earnings reports, and an important Federal Reserve decision on interest rates. The Dow Jones Industrial Average rose slightly, while the Nasdaq Composite increased by 1.1%. The S&P 500 also climbed 0.6%, bolstered by a rally in semiconductor stocks.
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The revived interest in AI stocks was fueled by the recent IPO prospectus from Anthropic, submitted publicly on Monday, which detailed both the potential and risks associated with artificial intelligence. This trend also positively impacted Asian markets, particularly South Korean chip stocks and the KOSPI index.
Attention is set to shift to major earnings releases on Wednesday from leading tech companies like Alphabet and Microsoft. On Tuesday, market participants absorbed better-than-expected quarterly results from Coca-Cola and fintech company SoFi Technologies.
Anticipation is building ahead of the Federal Reserve's interest rate decision on Wednesday, as policymakers meet to address inflation concerns. Investors currently see only a 10% likelihood of a rate hike, according to CME Group data.
Stock movements also included JetBlue, which saw a rise in shares despite reporting a wider-than-expected third-quarter loss; the airline cited strong demand as a key factor. Oracle is diversifying its AI infrastructure by signing contracts with Google and other chip manufacturers, aiming to reduce reliance on Nvidia’s processors.
In commodities, oil prices dropped as prospects for deescalation in the Middle East conflict influenced market sentiment, although renewed attacks by Iran-supported groups in the region have raised supply concerns.
Coca-Cola raised its earnings outlook despite noting slowing demand in North America, and UPS shares jumped 2% on increased revenue guidance and an optimistic holiday demand forecast.