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US stocks opened higher on Thursday as gains in chip and consulting stocks supported Wall Street, although surging Treasury yields and concerns over inflation and government borrowing remained key market headwinds.
The Nasdaq Composite gained 0.45% or 125 points while the S&P 500 rose 0.23%. The Dow Jones Industrial Average added 0.38%.
The gains came as investors continued to favour artificial intelligence-related stocks at the start of October.
The Nasdaq had outperformed other major indexes in September, rising 1.9% as technology shares offset weakness across much of the broader market.
The S&P 500 fell 0.5% during the month, while the Dow declined 4.3%.
The third quarter also ended with the S&P 500 and Nasdaq each gaining about 2%, while the Dow fell 2.7%.
Chip stocks and consulting firms gain
Micron Technology’s stronger-than-expected revenue forecast and $32 billion in customer commitments under supply agreements reinforced investor confidence in AI-related demand.
Micron shares slipped about 1.7% in trading despite the company’s strong results, after its stock had nearly quadrupled this year.
The company reported that revenue quadrupled in the latest quarter, while its profit margins reached 87%.
Other chip stocks gained, with Nvidia up 0.47% and Lam Research rising 2.03% in trading. AMD and Broadcom also moved higher.
Alphabet added 1.49% after unveiling its Gemini 4 flagship AI model, extending the positive momentum in technology stocks.
Consulting stocks also advanced sharply.
Accenture jumped 22% after forecasting full-year revenue growth above estimates. Cognizant climbed 11%, while IBM gained 6.3%.
Elsewhere, Constellation Energy rose 5% after signing a 20-year power purchase agreement with Amazon.
Rocket Lab gained 1.4% after securing its largest-ever Electron commercial launch agreement, covering 20 launches with Synspective.
Treasury yields remain a key concern
Despite the gains in equities, Treasury yields climbed to levels not seen in more than two decades.
The 10-year Treasury yield reached 5.342%, its highest level since 2002, while the 30-year yield stood at 5.68%. The 10-year yield also moved above its June 2007 high of 5.328%.
Rising energy costs, heavy government borrowing and continued investment in AI infrastructure have contributed to expectations that interest rates could remain elevated.
WTI crude rose 0.39% to $90.76 a barrel as markets monitored developments in the Iran conflict.
Softer-than-expected inflation data on Wednesday reduced expectations for an interest-rate increase later in October.
Traders were pricing in a 63% probability that the Federal Reserve would keep rates unchanged, although a December hike remained possible with inflation still above the central bank’s 2% target.
Weekly jobless claims fell, while layoffs also declined in September, pointing to continued stability in the labour market.
Further comments from Federal Reserve officials could provide additional clues about the central bank’s policy outlook.
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