S&P 500 falls as AI worries hit software makers
OpenAI's launch last week of its newest model reignited speculation that AI could compete with services now offered by specialised software companies.
The S&P 500 experienced a decline on Tuesday, with software companies such as Salesforce, Intuit, and ServiceNow shedding value. Meanwhile, tensions in the Middle East and anticipation for inflation data weighed on investors, as they waited to see if an interest rate hike was likely from the US Federal Reserve's upcoming decision.
The S&P 500 software and services index dropped 1.4%, marking a second consecutive day of decline. Jed Ellerbroek, a portfolio manager at Argent Capital Management, noted that the launch of OpenAI's new model, GPT-6 Astra, had reignited concerns about AI potentially competing with specialized software services. Intel and Qualcomm, on the other hand, saw gains of 9% and 3.2% respectively after securing a deal with Amazon to develop custom AI chips.
Traders increased their expectations of a Federal Reserve interest rate hike at their September meeting, with a 60% probability indicated by the CME FedWatch tool. The S&P 500 closed the day at 7,673.52 points, down 0.58% from the previous session, while the Nasdaq slipped 0.32% to 26,421.41 points, and the Dow Jones Industrial Average fell 1.18% to 52,786.07 points.
The number of declining stocks within the S&P 500 exceeded the number of rising ones by a ratio of 2.4-to-1.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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