The S&P 500 increased by 0.5% on Tuesday, buoyed by a surge in chipmaker stocks as traders continued to show interest in the sector. The Dow Jones Industrial Average remained nearly flat, while the Nasdaq Composite observed a 1% rise. Investors also kept an eye on declining oil prices and various corporate earnings reports coinciding with the Federal Reserve's two-day policy meeting.
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Shares of Broadcom rose over 3% following a $63 billion financing announcement by a coalition of banks, including Bank of America, Citi, and Morgan Stanley, aimed at purchasing Broadcom's technology for Anthropic. Other chip companies, such as Micron Technology and Advanced Micro Devices, also posted gains of 1% and nearly 3%, respectively.
This week’s momentum follows a strong trading session from the previous day, driven by interest in artificial intelligence-related stocks, particularly after Anthropic filed for an initial public offering (IPO) at Nasdaq, marking a significant tech IPO in 2026 after SpaceX's listing in June.
Jed Ellerbroek, a portfolio manager at Argent Capital Management, noted the market experiences cycles of concern regarding AI spending, often followed by gains in tech stocks. He emphasized confidence among companies with data centers to continue growing, despite potential volatility in capital markets.
Oil prices contributed to market sentiment as they dropped amid hopes for eased regional tensions. U.S. West Texas Intermediate futures decreased by nearly 1% to around $101 per barrel, with the global benchmark Brent crude down about 1% to roughly $114 a barrel.
In company-specific news, JetBlue's shares skyrocketed by 20% after announcing expectations of margin growth in the fourth quarter, despite reporting a larger-than-anticipated third-quarter loss. Conversely, Whirlpool’s stock fell more than 1% after posting an unexpected quarterly loss.
As the Federal Reserve kicks off its latest monetary policy meeting, analysts anticipate that rates will remain unchanged. However, statements regarding future rate hikes may be closely watched, particularly ahead of the midterm elections scheduled for next week.
In other market movements, Stephens initiated coverage of Mama's Creations with an overweight rating, setting a target price of $19 per share.
SoFi Technologies shares surged over 13% after reporting third-quarter results that surpassed expectations, with the company benefiting from raised guidance for the year. Additionally, China reported a 14.4% increase in industrial profits for September, marking the strongest growth rate in three months.