Indexes: Dow gains 0.19%, S&P 500 declines 0.02%, Nasdaq falls 0.06%
Amazon surges after AWS expansion eases concerns over increased AI expenses
Apple tumbles amid supply chain worries
Yields spike after three dissident members of the Fed argue that a rate increase is required

July 31 (Reuters) – The key equity indexes on Wall Street were mixed, fluctuating slightly between minor gains and losses, as concerns about the future trajectory of rates along with falling stocks from Apple offset the 13.7% rise seen in Amazon.
Amazon.com Inc. (AMZN.O), opens new tab posted revenue growth of the highest level since more than four years ago in its latest quarter, following the announcements by Microsoft Corp. (MSFT.O), opens new tab and Alphabet Inc. (GOOGL.O), opens new tab last week.

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On the other hand, Apple (AAPL.O), opens new tab, fell by 9.2%, as it issued warnings saying that supply limitations would affect growth amid growing concerns about the impact of the iPhones’ pricing increase.
For this week, many analysts have been referring to it as the make-or-break week for the tech industry, which had been downgraded by traders after taking profits during July due to an impressive ending of the second quarter, as they waited for any signs that the investments that AI companies have been making were paying off.
“Essentially, the idea behind the investment is are these going to be accretive, and when do we see that? I think we’re seeing it immediately now,” said Chris Ballard, managing director at Check Capital Management, discussing Alphabet and Amazon.

“And it’s great to see that and it does give us reason to continue investing in them.”
Microsoft stocks rose by 1.5%, having made the largest gain ever for a day for any company in the preceding session, with Alphabet rising by 5% and Meta (META.O) increasing by 1.5%. In the semiconductor space, Nvidia (NVDA.O) rose by 0.8% and Monolithic Power Systems (MPWR.O) gained 11.1%, on the back of better-than-expected Q3 revenues forecast.

Amazon exceeds cloud growth expectations due to AI demand

At ​11:43 a.m. ET, the Dow Jones Industrial Average (.DJI), opens new tab gained 99.24 points, or 0.19%, to 52,306.20, the S&P 500 (.SPX), opens new tab declined 1.49 points, or 0.02%, to 7,436.14 and the Nasdaq Composite (.IXIC), opens new tab declined 15.65 points, or 0.06%, to 25,106.53.
The consumer discretionary sector (.SPLRCD), opens new tab of S&P 500 was the best.

TOUGH MONTH FOR STOCS

But all three of Wall Street’s major indices are heading for a gain on the week, with the strong comeback that occurred this week helping their chances. However, both the S&P 500 and Nasdaq indices are expected to post a loss for the month, following the sharp selling in AI-related stocks that has been seen throughout July.
The Philadelphia Semiconductor index (.SOX) finished flat on Friday and fell 20% in July, which will be its largest monthly drop since 2008. Instead, other parts of the market saw the focus, as the S&P 500 equally-weighted index (.EWGSPC) is heading for a fourth straight month of gains.
“This momentum crash was tremendous and the positioning has been rinsed,” Laurent Clavel, global head of multi-asset at AXA Investment Managers, BNP Paribas Asset Management.

“It is now early August, and if anything, we are entering it slowly. We’re buying this weakness, and we’re re-buying this AI story,” said Clavel.
The week was also full of uncertainty in regard to interest rates following the ⁠hold on the Federal Reserve’s benchmark rate. No much information about the future interest rates was provided in chairman Kevin Warsh’s remarks; nonetheless, there were at least three people calling for higher interest rates on Friday.

The two-year Treasury note rate, which measures short-term interest rates, shot up by 7 basis points to 4.29%. The probability of a rate increase of 25 basis points in September was estimated at 67%, according to CME’s FedWatch service.
Internet domain registrar GoDaddy (GDDY.N), opens new tab fell 20% amid a lowered annual revenue estimate.
Losers prevailed over gainers in a ratio of 1.58-to-1 on the NYSE and 1.89-to-1 on the Nasdaq.
S&P 500 gained four new 52-week highs and three new lows, while Nasdaq Composite added 35 new highs and 86 new lows.