Global shares tumble after a wipeout on Wall Street as Big Tech retreats
U.S. stocks are rising, a day after their worst losses since 2022 led to a wipeout for financial markets around the world
NEW YORK — U.S. stocks are rising Thursday, a day after their worst losses since 2022 led to a wipeout for financial markets around the world.
The S&P 500 rose 0.9% in afternoon trading after a surprisingly strong report on the U.S. economy raised hopes for stronger profits at smaller stocks and other formerly unloved areas of the market. The Dow Jones Industrial Average was up 468 points, or 1.2%, as of 12:51 p.m. Eastern time and the Nasdaq composite was 0.9% higher.
Many Big Tech stocks also gained ground, a day after profit reports from Tesla and Alphabet underwhelmed and raised concerns that investors' frenzy around artificial-intelligence technology had sent stock prices too high.
Whether the handful of stocks known as the «Magnificent Seven» are rising or falling makes a huge impact on Wall Street because they've grown to be the most valuable U.S. companies by far. That gives their stock movements larger sway on the S&P 500, and the Magnificent Seven have been the main reasons the index has set dozens of all-time highs in 2024.
For much of the year, Big Tech's strength masked weakness for other stocks underneath the market's surface, as they struggled with high interest rates meant to get inflation under control. But Thursday's report on the economy raised hopes that profits will strengthen for all kinds of companies and sparked a widespread rally.
The economy's growth accelerated to an estimated 2.8% annual rate from April through June, double the rate from the prior quarter. Perhaps just as importantly for Wall Street, the report wasn’t so hot that it fanned worries about upward pressure
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