Amazon Leads Gains as Apple Falls Amid Oil Price Surge
The US stock market experienced another wild day on Friday, as Wall Street's July continues to be rocky. Amazon led the gains, rising 15% after reporting a significant increase in profits for the latest quarter. The company's cloud computing business saw an acceleration of growth, and its profit more than tripled from last year. This is similar to Microsoft's reaction yesterday, when it soared to its best day in nearly 18 years.
However, not all tech stocks were winners. Apple dropped 9.2% despite reporting stronger profits than expected, due to a forecasted growth slowdown in the current quarter caused by supply chain issues related to the AI boom.
Rising oil prices also added to worries about inflation, pushing up the price of Brent crude to $88.68 and the average cost for regular gasoline to nearly $4.11 per gallon across the US. This has had a ripple effect on bond yields, with the 10-year Treasury yield jumping to 4.73%.
The Fed's chair, Kevin Warsh, reaffirmed his commitment to getting inflation back down to 2%, but did not provide details on how he plans to achieve this. Economists at Bank of America have expressed concerns about the Fed's credibility problem, calling for interest rate hikes in September if data shows continued pressure on inflation.