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Micron Technology Stock Boosted By AI Demand

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Key Takeaways

  • The S&P 500 advanced 0.3% on Thursday, March 21, 2024, adding to its record high after the Fed reiterated its rate cut forecast for 2024.
  • Semiconductor stocks posted strong gains, with shares of Micron Technology soaring after the firm beat quarterly estimates amid strong AI demand.
  • Shares of Accenture dropped after the consulting firm reduced its guidance, citing macroeconomic uncertainties.

Major U.S. equities indexes moved higher on Thursday, adding to the all-time highs posted in the previous session.

The record-setting rally comes after the Federal Reserve said it would hold interest rates steady yesterday, but reiterated projections for three rate cuts in 2024.

The S&P 500 advanced 0.3% on the day. The Dow and the Nasdaq were up 0.7% and 0.2%, respectively.

Enthusiasm for semiconductor firms that stand to benefit from the proliferation of artificial intelligence (AI) technology took center stage once again. Shares of Micron Technology (MU) led the S&P 500 higher, soaring 14.1% after the manufacturer of memory and storage chips beat quarterly sales and profit estimates amid strong AI-driven demand.

Server manufacturer Super Micro Computer (SMCI) saw its shares jump 8.4% on Thursday, recovering some of the losses posted in the previous session after the firm said it would sell around $2 billion worth of stock. Despite the issuance of additional shares, the company has made strategic investments that could boost its position as a supplier to AI-focused companies. Super Micro Computer stock debuted on the S&P 500 earlier this week.

Other semiconductor stocks also traded higher. Broadcom (AVGO) shares gained 5.6% after TD Cowen upgraded the stock and lifted their price target. Broadcom’s AI infrastructure event helped convince the analyst team that the chipmaker’s custom silicon and back-end AI networking products could drive strong growth.

Shares of Accenture (ACN) suffered the heaviest losses on the S&P 500, tumbling 9.3% after the consulting firm reduced its guidance amid a slowdown in sales and new bookings. Accenture’s CEO noted the company was facing an “uncertain macro environment.”

Financial data and analytics provider FactSet Research Systems (FDS) posted mixed financial results, beating earnings estimates but falling short on revenue, and its shares dropped 7.6%. The company also said it expects full-year revenue to come in at the low end of its previously issued guidance.

Darden Restaurant (DRI) shares slipped 6.5% after the operator of Olive Garden, LongHorn Steakhouse, and other restaurant chains posted lower-than-expected quarterly revenue and cut its full-year sales outlook. Although Darden got a boost from Ruth’s Chris Steak House, which it purchased last year, same-store sales declined at Olive Garden, its biggest revenue generator.

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