Amazon Soothes Wall Street Jitters with Record-Breaking Earnings

Wall Street closed higher on July 31, capping off a strong week and month for equities. The gains were largely driven by Amazon's impressive quarterly report, which boosted investor confidence in AI-related stocks.

The tech giant's revenue growth exceeded expectations, alleviating concerns about overspending on artificial intelligence infrastructure. This sentiment was echoed by CEO Andy Jassy's comments, which put to rest worries that Amazon's spending was 'irresponsible' or a 'moonshot' investment.

Despite Apple's disappointing results, the S&P 500 technology index managed to gain due to strong performances from other tech stocks. Microsoft, in particular, surged after forecasting stronger-than-expected cloud growth.

The PHLX chip index also rose, but remains down over 20 percent from its June 22 record high close. Analysts expect S&P 500 aggregate second-quarter earnings to soar 48 percent year-over-year, with AI-related stocks driving much of this growth.