AI Stocks Slump Again; Oil Prices Rise 07/16 09:16

   Computer chipmakers and other winners of the artificial-intelligence boom 
are swinging lower again on Thursday and dragging stock markets down worldwide. 
Oil prices, meanwhile, continue to climb because of the war with Iran.

   NEW YORK (AP) -- Computer chipmakers and other winners of the 
artificial-intelligence boom are swinging lower again on Thursday and dragging 
stock markets down worldwide. Oil prices, meanwhile, continue to climb because 
of the war with Iran.

   The S&P 500 fell 0.4%, a day after it pulled back within 0.5% of its 
all-time high set last month. The Dow Jones Industrial Average was up 64 
points, or 0.1% as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.8% 
lower.

   AI winners like Micron Technology led the way lower, and the maker of 
computer memory fell 3.2%. It's still up a stellar 206% for the year so far 
because of soaring demand for its products in the AI investment boom.

   Sandisk fell 5.3%, but is still up 545% for the year so far. Western Digital 
sank 5.1% but is still up 182% for the year so far.

   Such stocks have been under pressure for weeks because of worries that their 
prices simply shot too high and that the strong demand for computer memory and 
processors may not be sustainable if AI ends up not producing as much profit 
and productivity as promised.

   The losses came even though Taiwan Semiconductor Manufacturing Co., a 
bellwether of the chip industry, reported a stronger profit for the latest 
quarter than analysts expected. Its stock in Taiwan rose 1.2%, but its stock 
that trades in the United States fell 1.6%.

   In South Korea, drops for AI winners like Samsung Electronics and SK Hynix 
dragged the Kospi index down 6.4%. It's been among the world's shakiest in 
recent weeks because of how dominant the two AI winners are in it. The day 
before, it jumped 6.2%, but it's also had drops of 8.9%, 7.8% and 5.3% in the 
last two weeks.

   A hike to interest rates by the Bank of Korea also contributed the tumble. 
It was the first rate hike in Seoul since 2023 and was aimed at helping curb 
inflationary pressures due to the Iran war.

   Worries are high that other central banks around the world will also have to 
raise interest rates to keep a lid on inflation because of jumping oil prices. 
Higher rates would keep a lid on inflation, but they also slow the economy and 
hurt prices for all kinds of investments.

   In the U.S. bond market, Treasury yields rose as oil prices continued to 
climb.

   The price for a barrel of Brent crude rose 0.7% to $85.55 and is near a 
one-month high.