The Nasdaq Composite hit a record closing high on Monday, September 21, for the first time since June 2, driven by renewed investor enthusiasm for artificial intelligence, dubbed "AI Fomo" (Fear of Missing Out). This surge occurred despite previous warnings from AI leaders a week prior that had caused a global tech selloff. The tech-heavy index rose by 2.26% to 27,122.09 points, while the S&P 500 gained 1.49%, closing just shy of its own record, and the Dow Jones Industrial Average finished up 0.71%.
Chipmakers were at the forefront of this rally. Advanced Micro Devices (AMD) saw its stock close 10% higher, achieving a market capitalization of $1 trillion for the first time. Other significant gains included Intel and Arm Holdings, both surging over 12%, contributing to a 4.3% jump in the PHLX semiconductor index. Meta Platforms also saw an 11.4% increase after Wells Fargo raised its price target following the launch of Meta's Muse AI assistant.
Contributing to the positive sentiment were falling oil prices and retreating long-dated Treasury yields. U.S. crude fell 4.86% to $95.43 a barrel, and Brent crude dropped 3.62% to $100.11 per barrel, with some analysts attributing this to speculation about potential breakthroughs in Middle East talks. The benchmark 10-year US Treasury yields fell 4.5 basis points to 4.951%, moving below the psychologically important 5% level.
Despite concerns over potential further global interest rate hikes, with markets pricing in a 56% chance of another US rate increase in October, risk appetite remained strong. The MSCI All-World index rose 1.31%, and European shares rallied 1.02%. Investors are also looking ahead to a meeting between US President Donald Trump and Chinese President Xi Jinping, hoping for an extension of the current trade truce and potential cooperation on AI. Bitcoin also surged over 6% to an eight-month high, signaling increased risk tolerance among investors.
