Stock Market Today: Dow Eyes 2% Jump as AMD Earnings Ease AI Spending Fears
AMD just reported a quarter that sent shockwaves through premarket trading, but whether one blowout earnings report can rebuild confidence across the entire AI trade is a question the rest of the day still has to answer.
The S&P 500 is set for a strong start Wednesday. An ETF tracking the index was up 1% in delayed premarket trading. The push came from Advanced Micro Devices (NASDAQ:AMD | AMD Price Prediction), which posted a record quarter and a forecast that eased AI spending fears. A gain would help the S&P 500 recover from a soft month, when its ETF proxy slid 1%.
These are delayed premarket ETF readings, so opening moves may differ. Before the bell, the Nasdaq-100 ETF serves as the closest stand-in for the Nasdaq Composite.
| Index | ETF Proxy Move in Premarket |
|---|---|
| S&P 500 | +1% |
| Nasdaq-100 | +1% |
| Dow Jones | +2% |
| Russell 2000 | +1% |
AMD Says Demand Is Outrunning Supply
AMD rose 6% premarket to about $512. Adjusted EPS of $2.09 beat the $1.94 consensus.
Data Center revenue grew 97%, and AMD guided fourth-quarter revenue to about $17 billion. CEO Lisa Su said “demand is higher than supply.” Shares had fallen 19% over the past month going into the report.
Arista Networks (NYSE:ANET) rose 11% after revenue grew 59% and fourth-quarter guidance of $3.9 billion to $4.0 billion came in above the Street. Astera Labs (NASDAQ:ALAB) slid, even though revenue jumped 154%. Expectations were already high for the stock.
Blue Chips and Financials Join the Rally
Amgen (NASDAQ:AMGN), a Dow component, inched higher. Non-GAAP EPS of $6.45 exceeded estimates, and Amgen raised full-year EPS guidance to $22.90 to $23.70.
Apollo Global Management (NYSE:APO) gained 2% despite adjusted EPS of $2.07 missing estimates. Rising rates forced paper losses in its retirement unit, but fee-related earnings grew 23%.
Shares of Archer-Daniels-Midland rose 1% after raising its adjusted EPS guidance to $5.50 to $5.80, helped by demand for biofuels.
A Broad Rally Tells You More Than an AI Pop
The Dow and small caps are keeping pace with tech. That points to buying across the market that extends beyond chipmakers. For holders of AI names, the key detail is AMD’s comment that limited supply is the main brake on its growth. Even so, the Nasdaq-100 ETF is still down 8% over the past month, so one strong session does not offset that drop.
Tonight’s AI Reports Are the Next Test
More than 300 companies report after the close, including several AI names. Their results will show whether AMD’s confidence carries over to the rest of the AI trade.
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After two decades of patrolling the dark corners of suburbia as a police officer, Rich Duprey hung up his badge and gun to begin writing full time about stocks and investing. For the past 20 years, he’s been cruising the markets looking for companies to lock up as long-term holdings in a portfolio while writing extensively on the broad sectors of consumer goods, technology, and industrials. Because his experience isn’t from the typical financial analyst track, Rich is able to break down complex topics into understandable and useful action points for the average investor. His writings have appeared on The Motley Fool, InvestorPlace, Yahoo! Finance, Money Morning, and, of course, 24/7 Wall St. He has been featured in both U.S. and international publications, including MarketWatch, Financial Times, Forbes, Fast Company, and USA Today.
