The stock market opened higher on Wall Street, with the S&P 500 up 0.3% and the Nasdaq composite up 0.4%, led by gains in technology stocks. Marvell Technology saw a 23% jump after reporting strong demand related to artificial intelligence and forecasting AI revenue to at least double from the prior year. This follows Nvidia’s report on Thursday of big forecast sales related to AI. Treasury yields rose after a tick higher in inflation. There is optimism that Congress and President Joe Biden will strike a deal to lift the US government’s debt ceiling and avert a potentially calamitous default, with a two-year budget deal being negotiated.
According to a report from a breaking news update from the Associated Press, stocks opened higher on Wall Street on Friday, May 20th, led by more gains in technology stocks as another chipmaker reported strong demand related to artificial intelligence. The S&P 500 was up 0.3% in the early going, and the Nasdaq composite was up 0.4%. The Dow rose 80 points, or 0.3%.
Marvell Technology jumped 23% after the chipmaker said it expects AI revenue in fiscal 2024 to at least double from the prior year. This follows Thursday’s report from fellow chipmaker Nvidia, which gave a big forecast for upcoming sales related to AI.
According to a report from Federal News Network, Wall Street followed world markets modestly higher early Friday, lifted by optimism that Congress and the president will strike a deal to unlock a vote for lifting the U.S. government’s debt ceiling and avert a potentially calamitous default. Futures for the Dow Jones Industrial Average and the S&P 500 each rose about 0.2% before the bell.
Officials said President Joe Biden and House Speaker Kevin McCarthy were narrowing in on a two-year budget deal that could open the door to lifting the nation’s debt ceiling. The Democratic president and Republican speaker hope to strike a budget compromise this weekend. A two-year deal would raise the debt limit for that time, past the 2024 presidential election. As their price for raising the legal debt limit, Republicans have been demanding spending cuts the Democrats oppose.
U.S. markets have been down this week on worries that Washington could run out of cash to pay its bills as soon as June 1st, unless Congress allows it to borrow more. The widespread expectation is for a compromise before it’s too late, as has happened dozens of times before, because a failure would likely be awful for the economy.
Fitch said late Wednesday that it could downgrade the U.S. government’s “AAA” credit rating if the debt ceiling isn’t raised soon, which would be a major blow to the country’s financial reputation.
Inflation concerns are also contributing to market volatility, with Treasury yields rising after another tick higher in inflation. However, the tech sector continues to perform well, with chipmakers like Marvell Technology and Nvidia reporting strong demand related to artificial intelligence.
In view of all the above, the stock market remains cautiously optimistic as Congress and the president work towards a budget deal that would lift the U.S. government’s debt ceiling and avoid a default. Investors will be closely watching for updates on this situation in the coming days and weeks.