Amazon Soars as US Stocks Rally, Despite Inflation Worries
The US stock market finished July on a high note, despite concerns about inflation and rising oil prices. The S&P 500 climbed 0.7% after experiencing wild fluctuations throughout the day. Amazon led the gains with a 15.3% increase, thanks to its stronger-than-expected quarterly profit. Analysts believe this could be a sign that Amazon's artificial intelligence investments are paying off.
Meanwhile, Apple dropped 7.4%, despite reporting higher profits than expected. However, its revenue growth forecast for the next quarter fell short of analyst expectations, attributed to supply chain issues due to increased demand in the AI sector.
The rising oil prices continue to weigh on inflation concerns, with Brent crude settling at $87.93 per barrel and gasoline averaging nearly $4.11 per gallon nationwide. This has led to higher yields in the bond market, with the 10-year Treasury yield reaching 4.71% from 3.97% before the war with Iran.
The Federal Reserve's chairman, Kevin Warsh, reiterated its commitment to keeping inflation at 2%, but refused to provide a clear plan on how to achieve this goal. Economists are warning that without action, the Fed may face a credibility problem and struggle to meet its target in September.