Wall Street closed the week riding a semiconductor rebound that pushed the AI infrastructure trade back into favor, even as a spike in Treasury yields tested the rally’s staying power.
Advanced Micro Devices Inc. (NASDAQ:AMD) supplied the week’s biggest milestone. Shares surged as much as 10% on Monday, pushing the company past a $1 trillion market capitalization for the first time and capping a five-session winning streak fueled by renewed demand for AI chips.
The stock has very nearly tripled since the start of the year.
The performance gap vis-à-vis Nvidia Corp. (NASDAQ:NVDA) has reached over 160 percentage points since the start of the year, the widest one since the start of the AI era.
Meta Platforms Inc. (NASDAQ:META) also posted double-digit weekly gains after its new Muse AI agent became the top free app on Apple’s App Store, outpacing ChatGPT’s early download pace.
JPMorgan analyst Doug Anmuth wrote that Muse “has the potential to become the most widely used consumer AI application since ChatGPT.”
Moderna Inc. (NASDAQ:MRNA) rallied about 30% over the week, notching the best performance among S&P 500 stocks.
Thursday’s 7% jump came after three abstracts on its experimental cancer vaccine, intismeran autogene, were accepted at next month’s European Society for Medical Oncology Congress in Madrid.
The headline presentation covers late-stage melanoma data combining the vaccine with Keytruda from Merck & Co. Inc. (NYSE:MRK). Moderna has more than tripled since mid-August.
Akamai Technologies Inc. (NASDAQ:AKAM) joined the AI trade from an unexpected angle. After Thursday’s close, the content-delivery and cloud company announced a seven-year, $11.6 billion deal to supply Anthropic with computing capacity. Shares rallied over 15% on Friday.
Treasury Yields Hit 19-Year Highs
Risk sentiment hit a wall Wednesday, when the S&P Global flash composite PMI jumped to 58.4, the fastest U.S. business growth in over five years, but with input costs rising at their fastest clip in four years.
Bond traders read it as inflationary: the 10-year Treasury yield hit 5.2%, a first since 2007, and the 30-year hit 5.53%, its highest since 2004.
Markets now price in a 68% chance of a Fed rate hike next month and a 50% chance of an additional hike in December.
Chart: 10-Year Treasury Yields Spike to 5.2% as Economy Runs Hot
AI Agent Wave Hits Subscription Stocks
Muse’s success had a flip side. Investors began asking what happens to businesses that rely on customers forgetting to cancel.
Planet Fitness Inc. (NYSE:PLNT) fell as much as 11% on Tuesday as the app’s rise hit companies built on consumer inertia, with banks, insurers and travel sites also under pressure.
On Thursday, Citrini Research added fuel with a short list of 90 subscription stocks exposed to what it called an “agentic cancellation wave.”
Planet Fitness, Comcast Corp. (NASDAQ:CMCSA) and Liberty Global Ltd. (NASDAQ:LBTYA) were among its largest weights.
The firm asked what happens if the lazy customer “not only remembers to cancel their subscription, but is now looking to bargain for a better rate.”
Gen Digital Inc. (NASDAQ:GEN), the owner of Norton, Avast and LifeLock, fared worse, falling more than 20% for the week.
The stock dropped 12% on Thursday after the Financial Times reported that Gen had approached GoDaddy Inc. (NYSE:GDDY) about a possible acquisition.
The talks are in the early stages, according to the report, and may not produce a deal.
Next week, all eyes will be on Micron Technology Inc. (NASDAQ:MU), which reports fourth-quarter results after the close on Wednesday.
Analysts expect earnings of $31.30 per share on revenue of $50.62 billion, up from $3.03 per share and $11.31 billion in the same quarter a year earlier.
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