C3.ai, meanwhile, sank 5.9 per cent despite likewise topping analysts’ forecasts for profit in the latest quarter.
One AI-related company bucking the trend was Snowflake. The AI data cloud company rose 9.6 per cent after delivering stronger profit and revenue for the latest quarter than analysts expected.
It joined a wide range of stocks on the more staid end of Wall Street, ones that didn’t grab as many headlines as AI-related companies in recent years.
A 1.3 per cent rise for Berkshire Hathaway, the company run by famed investor Warren Buffett, was one of the strongest forces pushing upward on the S&P 500. The owner of Geico, BNSF railroad and other businesses has built a hoard of unused cash recently. That could indicate Buffett, who’s famous for buying stocks when prices are low, may not see much worth purchasing in a market that critics say looks too expensive.
Gains of 1.8 per cent for Visa and 1.8 per cent for UnitedHealth Group also pushed strongly upward on the market.
Some investors have been waiting for other kinds of stocks to pick up the market’s leadership baton from Nvidia and a handful of other high-growth, high-momentum companies that had dominated for years. Nvidia alone accounted for just over 22 per cent of the total return for the S&P 500 index last year.
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In the bond market, Treasury yields swung up and down following President Donald Trump’s latest announcement on tariffs. He said “the proposed TARIFFS scheduled to go into effect on MARCH FOURTH will, indeed, go into effect, as scheduled” for imports from Canada and Mexico. He also said he would add an additional 10 per cent tariff on Chinese products on that date.
Such tariffs could push up prices for US households when inflation has already shown itself to be stubborn to ease. Wall Street has been hoping such threats are merely talk and leverage that Trump will use in negotiations with other countries before ultimately inflicting less pain on the economy than feared.
But even if that were the case, all the tariff talk has already been enough to get US households to feel more nervous about the economy. That’s dangerous if it causes them to pull back on their spending, which has been one of the linchpins keeping the US economy out of a recession.
Such worries have created a rough run for the US stock market recently, and weaker-than-expected reports on the US economy knocked the S&P 500 off its record set last week.
They’re also pressuring the Federal Reserve, which has few if any tools to help an economy when economic growth is slowing and inflation is rising at the same time.
Jeff Schmid, president of the Federal Reserve Bank of Kansas City, said in a speech Thursday that he has “become more cautious” in his hopes that inflation will continue to ease. He also said that discussions with people in his district suggest “elevated uncertainty might weigh on growth” for the economy.
For now, at least, the US economy appears to be in at least solid shape. The government on Thursday left alone its estimate for how the US economy performed during the last three months of 2024, though it raised its estimate for a measure of inflation during the quarter.
A separate report said more US workers applied for unemployment benefits last week. While the number is at a three-month high, it is still nowhere close to where it’s been in past recessions.
The yield on the 10-year Treasury rose to 4.28 per cent from 4.26 per cent late Wednesday.
In stock markets abroad, indexes were mixed across Europe and Asia. Germany’s DAX lost 1.1 per cent, while Japan’s Nikkei 225 added 0.3 per cent.
AP
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