US stocks dip ahead of inflation data as tech sell-off hits Asia
NEW YORK: Wall Street stocks were mostly lower at the end of a choppy session Tuesday, digesting solid results from US banks and a pullback in Asian markets prompted by worries over the AI investment boom.
U.S. stock markets experienced a mixed session on Tuesday, as large American banks reported strong year-on-year profit growth despite rising inflation concerns. JPMorgan Chase, a key player in the banking sector, missed analyst estimates. The company's CFO, Jeremy Barnum, described U.S. consumer spending as robust, and consumer credit as resilient, even with persistent inflationary trends.
The banking sector's positive earnings provided some support to Wall Street indices, yet investors remained cautious ahead of Wednesday's consumer price index data. The S&P 500 closed flat, while the Dow and Nasdaq ended slightly lower.
In Asia, equities faced renewed pressure due to worries over the AI investment boom. The selling intensified after Broadcom's CEO, Hock Tan, likened the AI buying frenzy to gambling, stating that many investors had unrealistic expectations and were investing in companies they did not fully understand.
The International Monetary Fund (IMF) warned of an AI correction at its annual meeting in Bangkok. While AI and related technologies have boosted global growth, the IMF highlighted potential economic gains may not be as substantial as initially expected. South Korea's Kospi index fell by 5.5 percent on the day, with semiconductor giants SK hynix and Samsung experiencing significant losses.
The tech sector's struggles were evident as Japanese stocks also declined, with Kioxia, a prominent chipmaker, shedding more than 13 percent on the Nikkei 225. The Nikkei lost 1.8 percent in overall trading.
Written by urgent.news from New Straits Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
