Rebounding AI stocks send the S&P 500 within 1% of its record

NEW YORK (AP) — A rebound for AI stocks is sending indexes higher on Wall Street Monday.

The S&P 500 rose 0.7% and is back within 1% of its all-time high, even though the majority of stocks within the index fell. The strength for companies in the artificial-intelligence technology industry had the Nasdaq composite 1.1% higher, as of 1:30 p.m. Eastern time, and the Dow Jones Industrial Average was up 44 points, or 0.1%.

AI stocks have been swinging sharply in recent weeks on worries that their prices shot too high. Doubts are rising about whether all the dollars flowing into AI chips and data centers can possibly create enough gains in productivity and profits to make back all the investments.

Broadcom rose 4.3% and was the strongest force lifting the S&P 500 after announcing long-term agreements to provide silicon products to Apple. It's coming off two straight losses of more than 2% on Wednesday and Thursday at the end of last week, before the holiday for the Fourth of July.

The global appetite for AI from investors will face an additional test later this week when SK Hynix, the South Korean maker of computer memory, plans to raise $28 billion by selling shares of stock that will trade in the United States on the Nasdaq. That would make it one of the biggest U.S. offerings ever, behind SpaceX’s IPO from last month, which raised $75 billion.

SK Hynix’s stock in Seoul has already more than tripled so far this year because of the AI boom, but its day-to-day swings have included sharp losses in recent weeks. It fell 14.6% on Thursday alone, for example.

SpaceX, which owns the xAI business, has seen its stock likewise swing following its ballyhooed initial public offering. It erased an early gain to fall 0.9% in the last day of trading before it’s scheduled to join the Nasdaq 100 index of the largest non-financial stocks on the Nasdaq. That inclusion will force funds like the QQQ exchange-traded fund, which mimic the index, to buy SpaceX themselves.

Elsewhere in AI, TeraWulf climbed 7.9% after it said Anthropic agreed to a 20-year deal to use its data center in Kentucky. TeraWulf expects the deal to bring in roughly $19 billion in revenue. TeraWulf is in the midst of transitioning its business away from mining bitcoin and into high-performance computing.

In the oil market, prices drifted after OPEC+ announced Sunday that seven of its members plan to expand oil production by a combined total of 188,000 barrels per day in August. It was the fifth straight month that OPEC+ members have agreed to raise output.

The price of a barrel of Brent crude, the international standard, fell 0.5% to $71.79. That’s close to where it was before the United States and Israel attacked Iran in late February and sent prices spiking.

In the bond market, Treasury yields held relatively steady. The yield on the 10-year Treasury edged down to 4.48% from 4.49% late Thursday.

A report showed that growth last month for U.S. recreation, finance and other services businesses was roughly in line with economists' expectations. The survey by the Institute for Supply Management said that some businesses said they were seeing lower prices for gasoline and diesel, easing inflationary pressures.

In stock markets abroad, indexes fell modestly across much of Europe and Asia. Hong Kong’s Hang Seng was an outlier and rose 1.1%.