US stock markets close weaker – AI investments and rising oil prices weigh on shares

GE Vernova tumbles – investors take profits

GE Vernova stood out particularly negatively among individual stocks. Shares of the energy technology company fell 8.7 percent. While the company raised its annual revenue target, it disappointed with its wind turbine business. There, the loss widened compared to the same period of the previous year, which prompted investors to take profits after a share price rally of 65 percent since the beginning of the year.

Shares of Alphabet, Tesla, and IBM also closed clearly in the red, with losses between 1.3 and 2.3 percent, after initially starting trading on a stable note. At the Google parent, there is concern about whether the corporation's massive investments in Artificial Intelligence will pay off. At Tesla, investors are awaiting news in the area of Autonomous Driving and Robotics. At IBM, analysts expect a lowering of the annual forecast.

AMD, AT&T, and Philip Morris as bright spots

The day went differently for AMD: shares of the chipmaker gained 1.5 percent. AMD and the AI research company Anthropic announced a strategic partnership to deploy AMD GPUs with a total capacity of up to 2 gigawatts. In addition, AMD has committed to future equity investments in Anthropic of up to 5 billion dollars.

The telecommunications company AT&T also managed to impress. Shares rose by 3.5 percent after the company gained nearly a third more new mobile customers than expected in the second quarter. Shares of Philip Morris also impressed: rising by just over 6 percent, they briefly jumped to a record high just below 200 US dollars, before ultimately closing 3.3 percent higher. Revenue and operating profit of the tobacco company exceeded the average analyst estimates in the second quarter.

Nike's stock lost 1.8 percent in the Dow Jones. According to its two main Chinese distribution partners, TopSports and Pou Sheng, the sporting goods manufacturer had actively reduced online shipments to them. Texas Instruments' stock, which had already performed strongly this year, on the other hand gained another 1.0 percent ahead of the quarterly report – putting it up by nearly 70 percent over the year.

Change in sentiment: reality instead of fantasy

Molnar put the market events in more fundamental perspective. "After the AI euphoria of the past months, what counts now is no longer fantasy, but reality," he said. He also pointed to the armed conflicts in the Middle East, which, despite clearly rising oil prices, are currently being observed "surprisingly relaxed" on the stock markets. "The stock market wants to see rising revenues, strong profits, and above all an optimistic outlook. Whoever delivers is rewarded. Whoever disappoints is punished," said Molnar.

In post-market trading, attention then turned to the quarterly reports still outstanding. Molnar had previously expected that above all the figures from Alphabet and Tesla would set the direction for the technology sector and the mood on the markets. Investors therefore visibly held back during regular trading in order not to build up or unwind positions before the reports.

Overall, the trading day thus reflected a change in sentiment: after the strong share price gains of the past months, particularly in the technology sector, fundamental factors such as business figures, margins, and outlooks are gaining importance again. Investors reward delivery and punish disappointments – a mechanism that increased the pressure on the reports from Alphabet, Tesla, and IBM.

Outlook: what the next quarterly reports will bring

The movements at GE Vernova showed by way of example how quickly a previously celebrated stock can come under pressure. The rise of 65 percent since the beginning of the year had put the company in the spotlight of investors; the disappointing development in the wind power segment then triggered clear profit-taking pressure. Such dynamics are likely to play a role in other industries in the coming weeks as well, when companies present their business figures.

In the energy and commodity stocks, the rising oil prices also made themselves felt. Molnar rated it as remarkable that the geopolitical tensions in the Middle East had so far been taken rather calmly by the stock markets. However, if the conflicts should escalate further or oil prices rise even more sharply, this composure could prove deceptive in his assessment.

The reactions to the quarterly reports in the evening and in the coming days will show whether investors are actually only looking at hard fundamentals or whether the AI euphoria surrounding Anthropic, AMD, and other players will boost sentiment again. The partnership between AMD and Anthropic also makes clear that tech corporations continue to invest massively in AI infrastructure – a trend whose economic success is increasingly becoming an open question for many investors.

By Claudia Müller, dpa-AFX