Wall Street ends with mixed results after a pivotal day marked by the end of the shutdown

AMD Leads Gains with a 9% Surge, Fueled by Ambitious Growth Prospects and Leadership in AI

The semiconductor sector posted mixed performances, led by the spectacular 9% surge of Advanced Micro Devices, which closed at $258.89 after setting particularly ambitious financial targets during its investor day on Wednesday. The California-based manufacturer now aims for a compound annual revenue growth rate of 35% over the next three to five years, with data center revenues growing by more than 60% annually.

These forecasts have far exceeded market expectations, especially since the company plans to achieve earnings per share above $20 by 2030, compared to just $3.31 in 2024. The management highlighted that its Instinct AI chips are now deployed at seven of the world's ten largest AI companies, while its EPYC processors account for about 40% of the global server processor market. This growth trajectory is supported by the extension of the company's recent strategic partnerships, including its major agreement with OpenAI signed in early October to provide next-generation AI accelerators. JPMorgan analysts described these objectives as particularly aggressive but plausible, acknowledging that AMD has a robust technology portfolio capable of competing with Nvidia, the undisputed giant in the sector. Other companies in the semiconductor sector experienced more modest gains, such as Analog Devices (+3.44%), confirming investors' preference for diversified players with substantial exposure to the data economy.

Airlines Take Off as the Oil Sector Crumbles Under Supply Surpluses

The commercial aviation sector saw a significant rebound on Thursday, with United Airlines soaring 5.29% to $99.97, Delta Air Lines rising 4.75% to $60.48, and Southwest Airlines gaining 4.22% to $33.34. This enthusiasm reflects the industry's relief following President Trump's signing of the law to fund government agencies until the end of January, ending the shutdown that had led to gradual flight reductions of up to 10% and thousands of daily cancellations since October 1.

Airlines, which had struggled throughout the year with declines ranging from 2.7% to 34%, are now seeing the possibility of gradual normalization of traffic. However, the White House indicated that the publication of some crucial economic data, including October's employment and inflation figures, might never occur due to the prolonged administrative disruption. Conversely, the oil sector experienced significant losses, with Schlumberger losing 4.09% and Halliburton falling 4.03%, hit by an OPEC report announcing an additional production increase of 137,000 barrels per day starting in November. This decision, part of the OPEC+ strategy to regain market share in the face of rising U.S., Brazilian, and Guyanese production, weighed on demand prospects and kept Brent crude around $62 per barrel, its lowest level in several months.

Sector rotation reflects a reassessment of tech valuations and a cautious reallocation toward defensive stocks

Thursday's market behavior indicates a strategic reassessment of risks, with investors retreating due to the exorbitant valuations in the tech sector. Oracle dropped by 3.88%, Palantir Technologies by 3.56%, while Meta Platforms fell 2.88%, and Amazon declined by 1.97%. This confirms the continuation of the correction that began in early November when the combined market value of eight major AI companies saw an $800 billion decline.

This caution is coupled with growing macroeconomic concerns: the University of Michigan's consumer confidence index plummeted to 50.3 in November, marking the second-lowest level ever recorded, while US private employers added only 42,000 jobs in October according to ADP data, indicating a fragile labor market. Most investment flows have shifted to defensive and cyclical sectors: UnitedHealth Group rose by 3.55% after raising its annual profit forecast, Goldman Sachs gained 3.54%, and renewable energy companies like NRG Energy increased by 3.68%. This trend suggests that investors are anticipating both a Federal Reserve interest rate cut in December and a gradual normalization of economic activity following the end of the shutdown, while remaining cautious about the risks to the profitability of massive investments made by tech giants in AI infrastructure.