Wall Street rose on Monday, with the S&P 500 up 0.8 per cent, recovering its losses from last week and pulling within 1.6 per cent of its record high. The Dow Jones Industrial Average added 154 points, or 0.3 per cent, and the Nasdaq composite was 1.1 per cent higher.
Anthropic PBC, the company behind the Claude AI model, filed for its long-awaited IPO, giving tech stocks a boost. The company expects to begin trading on the Nasdaq Global Select Market under the symbol ANT, according to a filing with the US Securities and Exchange Commission. Anthropic filed confidentially in June. People familiar with the matter say investors' estimates of a fair valuation have shifted down to around US$1.4 trillion to US$1.5 trillion (A$2 trillion to A$2.1 trillion) after the company's investor day, with a valuation closer to US$1.75 trillion potentially achievable, some said.
Nvidia rose 2.5 per cent, recovering some of its losses from three straight losing weeks and keeping its position as the largest stock on Wall Street above Apple. Other AI stocks remained unsettled on worries about the cost of borrowing to build data centres and buy AI chips.
Meta Platforms outlined plans to raise US$35 billion by selling stock to help fund its AI investments, with a possible further US$60 billion from a new class of shares. Its stock initially dropped more than 2 per cent before flipping to a gain and then closing down 0.2 per cent. Meta said Nvidia, Advanced Micro Devices and Broadcom have indicated they may buy a total of US$5 billion of stock in the offering. That signals strong interest from chip companies that stand to benefit from AI spending, but it also gives fuel to critics of "circular financing" who say it raises the risk if AI is less successful than expected.
SpaceX, Elon Musk's rocket company that also runs the xAI business, agreed to a roughly US$40 billion deal with an entity managed by Apollo Global Management to lease AI computing power. Its stock opened with a loss and then flipped to a gain of 0.9 per cent. Musk warned over the weekend that hundreds of companies that rent out AI computing power are under threat because of the difficulty in borrowing money, saying on X that they could face "guppy-level death and consolidation." CoreWeave, a company that has borrowed to buy AI computing power it rents to customers, dropped 5.5 per cent before flipping to a gain of 5.1 per cent, with such swings becoming commonplace.
In Australia, futures point to a rise of 11 points, or 0.1 per cent, at the open, after the ASX added 0.2 per cent on Monday. The Australian dollar was trading at US70.25 cents.
Alphabet and Microsoft report their latest quarterly results on Wednesday, with Amazon to follow on Thursday. Roughly one in three stocks in the S&P 500 reports this week. The Federal Reserve is widely expected to leave interest rates unchanged at its Wednesday meeting, after hiking last month for the first time in three years. The yield on the 10-year Treasury fell to 4.98 per cent.
Abroad, Brazilian stocks fell sharply after President Luiz Inácio Lula da Silva won reelection in a result that surprised investors. French government bond yields eased and the CAC 40 rose 0.8 per cent despite recent violent protests in the country. The European Central Bank and the Bank of Japan meet on interest rates this week. Brent crude returned to US$111.40 a barrel, near the high end of its range since the war with Iran began.