AI race propels Silicon Valley tech firms Microsoft, Meta, and Google to new highs. Here's why

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Meta piloting gen AI tools for advertisers So, despite the industry-wide layoffs and low economic mood, what gives? We take a look. Software giant Microsoft Corporation achieved a historic market valuation of $3 trillion briefly on January 24, showcasing the profound impact of optimism surrounding artificial intelligence (AI) on its remarkable growth, Bloomberg reported. The company's stock experienced a 1.7 percent surge, reaching $405.63, pushing its market capitalisation just above $3 trillion during market hours.

However, it closed with a 0.9 percent increase, settling at a record high but with a valuation of $2.99 trillion. While brief, touching the $3 trillion threshold has solidified Microsoft's position as one of the largest public stocks. It briefly surpassed Apple Inc., which achieved the $3 trillion milestone last year, only to slip back below Apple's market valuation.

Apple concluded with a market valuation of $3.01 trillion. Also Read | Microsoft launches consumer version of Copilot AI assistant. Details here Throughout the year, Microsoft and Apple shares have been in contention for the top spot as the most capitalised stock on Wall Street.

According to Neil Dutta of Renaissance Macro, the latest US data indicating a substantial expansion in business activity for January, the most in seven months, is viewed positively for the stock market. Dutta told Bloomberg, "Growth is up and inflation is down," creating a favourable scenario for equity markets. The demand for AI services, coupled with cloud computing support, is anticipated to contribute to Microsoft's long-term growth.