[New York stock market close | October 15] Dow rose 1.08%... Healthcare and software are strong amid weak semiconductors

The three major indices rise together... Philadelphia Semiconductor Index fell for 7 consecutive trading days, Coreweave rebounded 5.9%... Government bond yields fall despite rising producer prices

The New York stock market closed higher amid mixed trends by industry. Semiconductor stocks continued to weaken due to concerns surrounding the borrowing burden of artificial intelligence (AI) infrastructure companies, but healthcare and software stocks showed strength, supporting the index's rise. While the Dow rose by more than 1%, the Nasdaq, which has a high proportion of technology stocks, only rose slightly.

On the 15th (local time), the Dow Jones Industrial Average ended trading at 52,177.69, up 556.21 points (1.08%) from the previous day. The Standard & Poor's (S&P) 500 index closed at 7744.06, up 25.12 points (0.33%), and the Nasdaq Composite Index closed at 26,713.03, up 20.16 points (0.08%). The Russell 2000 index, which focuses on small and mid-cap stocks, also rose by about 1.4%.

In healthcare, Eli Lilly rose 3.55% and UnitedHealth rose 2.79%. Stryker, a medical device company, also rose 4.12%. Among consumption-related stocks, Walmart showed strength, rising 1.47% and Home Depot rising 4.31%.

Software stocks also showed a large increase. ServiceNow jumped 6.14%, Intuit jumped 6.36%, and Salesforce and Adobe rose 4.57% each. Microsoft rose 1.08% and Oracle rose 3.00%, showing a different trend from semiconductors among technology stocks.

The Philadelphia Semiconductor Index closed at 11,581.22, down 103.16 points (0.88%) from the previous trading day, falling for 7 consecutive trading days. Nvidia fell 1.84%, AMD fell 1.50%, and Intel fell 2.80%. Semiconductor equipment companies Applied Materials and Lam Research also fell 3.72% and 3.30%, respectively. On the other hand, Micron rose 1.87% and Qualcomm rose 3.35%.

TSMC's performance and sales forecasts did not lead to a rebound in the overall semiconductor industry. TSMC's third quarter sales were $46.72 billion, exceeding the company's forecast range of $44.6 billion to $45.8 billion. The 4th quarter sales forecast was presented at $52.3 billion to $54.3 billion, but TSMC's stock price listed on the U.S. stock market fell after the earnings announcement.

In the process of evaluating AI-related companies, the burden of financing emerged as an issue along with the growth rate. Reuters reported that data center expansion through borrowing is raising concerns about the financial burden of AI infrastructure companies such as Coreweave. The burden is that if high interest rates continue, the costs required to expand investment and refinance existing debt may increase.

Coreweave, which had plummeted the previous day, closed up about 5.9% today. According to the Wall Street Journal (WSJ), Nvidia's stock price recovered after Nvidia CEO Jensen Huang expressed his opinion at a Bloomberg event that Coreweave's financial condition was improving.

The September Producer Price Index (PPI) released by the U.S. Bureau of Labor Statistics (BLS) rose 1.3% from the previous month and 6.3% from the same month last year. The monthly increase was the largest since March 2022.

September retail sales announced by the U.S. Department of Commerce increased 0.8% compared to the previous month. The sales growth rate of the control group used to estimate product consumption of gross domestic product (GDP) was only 0.1%. It is difficult to say that overall product consumption has strengthened based on the overall retail sales growth rate alone.

In the bond market, government bond interest rates fell despite high inflation indicators. The U.S. 10-year Treasury bond interest rate fell by about 10bp (1bp = 0.01% point) from about 5.19% the previous day to around 5.09% on this day. The Financial Times reported that amid anxiety surrounding AI investment and financing, demand for government bonds, a safe asset, has increased.