US stock markets showed mixed performance following Federal Reserve Chair Kevin Warsh's speech at the International Monetary Fund meetings in Bangkok, Thailand. According to reports from Goodreturns, the Dow Jones emerged as the top performer, while the Nasdaq Composite became the top loser and the S&P 500 traded volatile with marginal downside. The markets reacted on a mixed note to Warsh's comments, with the Dow Jones initially rising by 174.35 points or 0.33% to trade around 52,352.04 before erasing gains to trade at 52,146.98, down by 30.71 points. The benchmark has touched an intraday high of 52,582.32 and low of 52,303.17, opening at 52,308.28 on Friday.
The Nasdaq Composite index plunged by 368.68 points or 1.38% to trade around 26,344.35, as reported by Goodreturns. The index dropped by at least 386 points to hit an intraday low of 26,327.12, after opening lower at 26,652.98 and holding an intraday high of 26,674.66 before correcting steeply. Tech giants like Alphabet dropped 1.5%, while Microsoft plunged 1.7% and Amazon is down 0.5%. SpaceX and Meta crashed over 2.2% each, with Broadcom and Tesla slipping by 2.6% and 1.11% respectively. According to Reuters, Tesla and SpaceX could not grab buyers despite launching the world's first rocket-style flying car called Tesla Roadster, which is equipped with SpaceX thruster and expected to land in 2028.
According to Goodreturns, CoreWeave was nearly 7% lower, extending this week's losses to 18% to underscore fresh credit risk flare-ups for AI infrastructure companies. The sector was recently pressured by relatively tame revenue figures from Anthropic and the outlook for higher interest rates on debt-ridden companies. Micron, AMD, and Marvell fell by up to 3%, as reported by Trading Economics. Markets reassessed risks in the AI trade ahead of likely rate hikes by the Federal Reserve, with investors becoming more selective as concerns grow around the amount of debt being used to finance data centres and AI infrastructure. Data released this week showed higher consumer inflation and soaring producer prices, both headline and core.
During his speech, Warsh specifically avoided giving any clear guidance on FOMC's next rates decision, as reported by Goodreturns. The Fed are going to declare their bi-monthly monetary policy in the end of this month. Warsh shed light on rising energy prices, persistent inflation and higher borrowing costs that create unprecedent uncertainty on the overall global economy. However, he was optimistic of US economy's growth ahead and believes artificial intelligence (AI) to become major driving factor for future growth.
The S&P 500 extended its decline to trade at 7,696.50, down by 47.56 points, or 0.61%, as reported by Goodreturns. The benchmark opened at 7,745.32 and touched an intraday high of 7,756.84 and low of 7,719.02. The S&P 500 erased its 7,700 mark during the session. Among large-caps, JP Morgan gained 2.1%, Home Depot surged 1.8%, Walt Disney climbed 1.7% and Coca-Cola rose by 1.6%. American Express also rallied by more than 1.5%. Other mega caps like Merck, Chevron, Apple, Nike, Honeywell International and Johnson & Johnson rallied by more than 1% each, limiting the overall market decline due to strong buying in mega-cap stocks.
