Nasdaq notches record-high close, AI optimism reignites and US Treasury yields retreat

On September 21, the Nasdaq reached a record-high close, buoyed by strong performances in Advanced Micro Devices and other AI-focused companies. Treasury yields retreated from recent peaks, while crude prices dropped to an 11-day low due to hopes of a breakthrough in Middle East talks during a UN meeting. Chip stocks, including Intel and Arm Holdings, surged, with the PHLX semiconductor index climbing 4.3%.

Advanced Micro Devices surged nearly 10% to achieve a market capitalization of US$1 trillion for the first time. The Nasdaq noted its first record-high close since June 2, while the S&P 500 ended slightly below its August 13 record-high. Investors cited ongoing AI spending optimism, despite recent AI industry warnings that sparked a global tech sell-off.

US 10-year yields fell below the crucial 5% level as Brent crude prices fell below US$100 a barrel. US President Donald Trump expressed openness to a meeting with Iranian President Masoud Pezeshkian, who is set to attend the UN General Assembly. The S&P 500 rose 1.49% to 7,764.70 points, while the Nasdaq climbed 2.26% to 27,122.09 points.

Meta's shares soared 11.4% following a Wells Fargo price hike on Meta's AI assistant. AI-related heavyweights contributed significantly to the recent earnings expectation increase. However, investors remain cautious about potential interest rate hikes, with a 50% chance of another Fed rate hike in October according to CME's FedWatch.

Diplomatic progress between the US and Denmark over Greenland's status led to a surge in shares of US-listed companies in the region. Bitcoin saw a 6% rise, reaching a seven-month high, while a California lawsuit against Paramount Skydance's merger with Warner Bros Discovery caused a 3% drop in the company's stock. The S&P 500 posted more new highs than lows, with 64 new highs and 29 new lows, while the Nasdaq recorded 64 new highs and 127 new lows, indicating strong investor interest.