NEW YORK — The Nasdaq Composite gained 2.8 percent, closing at 25,122, as technology stocks extended their July rebound despite a 1.4 percent decline in Apple shares following its latest quarterly earnings report. The S&P 500 rose 1.7 percent to 7,438.
Apple shares dropped to $333.43 after the company reported Q3 revenue of $78.2 billion, missing analyst estimates of $80.5 billion. The iPhone maker's guidance for the current quarter also disappointed, projecting sales between $85 billion and $89 billion, below the $91 billion consensus. It marks a second consecutive quarter of decelerating revenue growth.
Microsoft led mega-cap tech, surging 15.5 percent to $451.10 after the software giant announced new enterprise AI contracts with a major financial institution and a healthcare provider, totaling more than $500 million in cloud services commitments. JPMorgan analysts raised their price target on Microsoft to $480, citing accelerating AI adoption in the enterprise.
Amazon added 3.9 percent to $235.50 after an internal memo outlined accelerated investment in fulfillment network automation for Q4. Nvidia climbed 2.6 percent to $195.04 on continued demand for its Blackwell GPUs. Tesla rose 3.5 percent to $308.85 on new production updates for its Cybertruck line.
Not all tech giants benefited. Alphabet fell 0.9 percent to $333.66, consistent with slower advertising revenue growth across Google Search and YouTube. Meta Platforms dropped 8.0 percent to $539.03 after Piper Sandler analysts reiterated concerns about its long-term metaverse investment trajectory.
The Russell 2000 rose 1.4 percent to 2,946, and the Dow Jones Industrial Average gained 1.2 percent to 52,208.
The market is drawing a clear line between companies with direct enterprise AI exposure and those facing consumer discretionary headwinds. Portfolio managers heavy in legacy consumer tech—particularly smartphone manufacturers—are trailing, while those positioned in AI hardware, software and cloud services continue to see gains.
Citigroup analysts cautioned against overconcentration in a handful of AI winners, flagging increased competition in the chip space from custom silicon developed by hyperscalers and ongoing supply chain risks in advanced packaging. Earnings reports from Broadcom and Micron next month will provide additional data on AI demand.
Federal Reserve Chair Kevin Warsh has maintained a data-dependent stance on interest rates. The next FOMC meeting is scheduled for Sept. 17-18.
