Wall Street bounces back as tech stocks recover and bitcoin stops plunging
NEW YORK (AP) — Technology stocks are recovering some of their losses on Friday, and bitcoin has halted its plunge, as Wall Street bounces back from big losses taken earlier in the week, at least for now.
The S&P 500 rose 0.9% and was heading for just its second gain in the last eight days. The Dow Jones Industrial Average was up 610 points, or 1.2%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.7% higher.
Chip companies helped drive the gains, and Nvidia rose 2.9% to trim into its loss for the week, which came into the day at just over 10%. Broadcom climbed 3.4% to eat into its drop for the week of 6.3%.
They benefited from hopes for continued spending by companies on chips to drive their forays into artificial-intelligence technology. Amazon, for example, said late Thursday it expects to spend about $200 billion on investments this year to take advantage of “seminal opportunities like AI, chips, robotics, and low earth orbit satellites.”
Such heavy spending, similar to what Alphabet announced just a day earlier, is creating concerns of their own, though. The question is whether all those dollar will prove to be worth it through bigger profits in the future. With doubt remaining about that, Amazon’s stock tumbled 9.6%.
The tentative trading means the S&P 500 is still flirting with its worst weekly loss since November, and its third in the last four weeks. Besides worries about big spending on AI by Big Tech companies, whose stocks are the most influential on Wall Street, concerns about AI potentially stealing customers away from software companies also hurt the market through the week.
Bitcoin, meanwhile, steadied itself somewhat following a weekslong plunge that had sent it more than halfway below its record set in October. It climbed back above $68,000 after briefly dropping around $60,000 late Thursday.
Prices in the metals market also calmed a bit following their own wild swings. Gold rose 0.7% to $4,924.40 per ounce, while silver fell 3.2%.
Their prices suddenly ran out of momentum last week following jaw-dropping rallies, driven by the desire among investors to own something safe amid worries about political turmoil, a U.S. stock market that critics called expensive and huge debt loads for governments worldwide. By January, though, prices were surging so quickly that critics called it unsustainable.
On Wall Street, the recovery for bitcoin helped stocks of companies enmeshed in the crypto economy. Robinhood Markets jumped nearly 12% for the biggest gain in the S&P 500. Crypto trading platform Coinbase Global rose 6.6%. Strategy, the company that’s made a business of buying and holding bitcoin, soared 15.1%.
In stock markets abroad, indexes ticked higher in Europe.
That was even though Stellantis, the auto giant whose stock trades in Milan, lost roughly a quarter of its value after saying it would take a charge of 22 billion euros, or $26 billion, as it dials back its electric vehicle production. The automaker acknowledged “over-estimating the pace of the energy transition” and said it was resetting its business “to align the company with the real-world preferences of its customers.”
Stocks fell across much of Asia, but Japan’s Nikkei 225 rose 0.8%. It benefited from a 2% climb for Toyota Motor, which said CEO Koji Sato will step down in April and will be replaced by the company’s chief financial officer, Kenta Kon.
In the bond market, the yield on the 10-year Treasury edged down to 4.20% from 4.21% late Thursday.
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AP Business Writers Chan Ho-him and Matt Ott contributed.