Key facts
- The Nasdaq Composite closed at a record high on Tuesday.
- Micron Technology and other AI-related stocks contributed to the Nasdaq's rise.
- Meta Platforms' AI assistant, Muse, launched this month and can perform tasks like sending emails and completing transactions.
- Concerns exist that Meta's AI assistant could compete with retailers, online brokerages, and other consumer companies.
- Amazon blocked Meta's AI agent from shopping on its platform.
- Ride-hailing apps Uber Technologies and Lyft, along with Expedia and Charles Schwab, saw declines.
The Nasdaq Composite index reached a new record closing high on Tuesday, driven by a rally in artificial intelligence-related stocks, including Micron Technology. The S&P 500 index, meanwhile, traded just below its own record high.
Investors are closely monitoring the market's reaction to Meta Platforms' recently launched AI assistant, Muse. The assistant's capabilities, which include sending emails and completing transactions on behalf of users, have boosted AI chip stocks. However, concerns are emerging that Muse could directly compete with consumer-facing companies.
Amazon has already taken steps to block the AI agent from its platform. Other companies that saw their shares decline due to fears related to Muse include ride-hailing services Uber Technologies and Lyft, as well as financial services firms Expedia and Charles Schwab. Memory chipmakers Micron and SanDisk, however, experienced rallies.
In broader market movements, oil prices remained volatile near $100 a barrel, and the yield on the benchmark 10-year Treasury note was around 4.94%. Federal Reserve officials offered commentary on monetary policy, with Boston Fed President Susan Collins supporting a recent interest rate hike and New York Fed President John Williams affirming the effectiveness of the Fed's rate control framework.
Traders are anticipating a potential interest rate increase by the Federal Reserve in October, with a 53% chance of a 25 basis point hike, according to CME Group's FedWatch Tool. Preliminary data indicated that the S&P 500 lost 0.01%, the Nasdaq Composite gained 0.45%, and the Dow Jones Industrial Average fell 0.36%.