Dow rises 556 points as investors shift from AI stocks to defensive sectors
U.S. stocks closed mostly higher Thursday as investors rotated out of AI-related shares into defensive sectors on inflation concerns, with the Dow Jones Industrial Average rising 556 points, or 1.08%. The S&P 500 gained 0.33% and the Nasdaq Composite added 0.08%, as semiconductor weakness capped tech gains. September producer price data showed the strongest annual wholesale inflation increase since December 2022, following higher-than-expected consumer inflation Wednesday, raising odds of a Federal Reserve rate hike to 67% for December. Healthcare and consumer stocks led gains, with Eli Lilly, UnitedHealth, and Walmart rising after Deutsche Bank upgrades. The Philadelphia Semiconductor Index fell for a seventh straight session as Nvidia and Broadcom declined after TSMC expressed caution on 2027 outlook, while bond yields remained near multi-year highs.