The technology sector witnessed a surge in stock prices as traders eagerly pursued opportunities in the ever-expanding field of artificial intelligence (AI).
CEO of IG Market North America and President of tastytrade, JJ Kinahan, expressed his astonishment at the stock-market rally, stating that it has exceeded all expectations. However, Kinahan noted that while mega-cap tech stocks continue to soar, the small-cap index Russell 2000 remains 20% below its peak. Nevertheless, he acknowledged that these prominent tech stocks are still leading the industry.
In contrast, Apple experienced a decline in its share price following the implementation of changes to its operating system and other offerings. The company claimed that these adjustments were made to safeguard consumers in the European Union from potential risks associated with new laws.
Meanwhile, Tesla encountered a significant setback as its CEO, Elon Musk, cautioned that the company is currently navigating through a period of slower growth. In order to maintain demand, Tesla has resorted to reducing prices, resulting in a drop of over 12% in its stock value.
Despite concerns raised by the Federal Trade Commission regarding the intense competition among large tech companies in the AI sector, traders remained undeterred. Microsoft, for instance, continued its upward trajectory and became only the second company in history to surpass a market capitalization of $3 trillion. Furthermore, it recorded a nearly 9% increase in gains during the first three weeks of the year, despite reports of layoffs within its videogaming division following the acquisition of Activision Blizzard in October.