Anthropic IPO Boosts AI Stocks, Nasdaq Rises
U.S. stock markets rose across the board on October 26 after news broke that artificial intelligence (AI) company Anthropic had applied to sell shares to the public for the first time. Semiconductor stocks had recently fallen because investors were worried about spending on AI. But these stocks recovered, helping the technology-focused Nasdaq Composite Index rise.
That day, the Dow Jones Industrial Average closed at 52,361.58, up 146.42 points, or 0.28%, from the previous trading day. The S&P 500 Index gained 53.09 points, or 0.70%, to reach 7,676.77. The Nasdaq Composite Index rose 214.04 points, or 0.82%, to close at 26,169.38.
Anthropic, which makes the AI chatbot Claude, officially began the process of listing its shares by filing a securities registration statement with the U.S. Securities and Exchange Commission (SEC) that day. The Wall Street Journal (WSJ), citing sources, reported that Anthropic could be valued at $1.5 trillion to $2 trillion and could raise more than $100 billion through its IPO.
Recently, Wall Street investors have worried that major technology companies are spending huge amounts on data centers and semiconductors, while income from AI is growing slowly. Against this background, analysts say Anthropic's reported fast sales growth has helped restore investor confidence in AI-related stocks. The company's revenue in the first half of this year was $16.286 billion, about 14 times its revenue during the same period last year.
Jay Woods, chief market strategist at Freedom Capital Markets, told CNBC that Anthropic's IPO filing was "news that boosts confidence in the market." He added, "We expect there to be demand as people have been waiting for a long time."
The Philadelphia Semiconductor Index, which tracks many semiconductor stocks, rose 2.82%. NVIDIA gained 2.39%, while AMD rose 2.80%. Micron and Broadcom also gained 2.98% and 2.33%, respectively. American Depositary Receipts (ADRs) for South Korea's SK Hynix rose 4.09%.
Tesla shares climbed 5.21% as investors paid attention to the possibility that British investment bank Barclays might raise its rating for the company and to the possibility of a merger with SpaceX. Barclays changed its investment rating for Tesla from "Underweight" to "Overweight."
Meanwhile, Meta shares fell 1.88% after the company announced plans to raise up to $95 billion through share sales and other methods to pay for AI infrastructure. After left-leaning President Luiz Inácio Lula da Silva won Brazil's presidential runoff election, the U.S.-listed exchange-traded fund (ETF) linked to Brazil's market, called "EWZ," plunged 19.82%.