New York Stocks Close Mixed; AI Stock Woes, Oil Price Plunge Weigh

New York stocks closed mixed amid overvaluation concerns for AI, while a sharp fall in international oil prices boosted cyclical stocks. On the New York Stock Exchange (NYSE) on the 24th (local time), the tech-heavy Nasdaq Composite Index fell 0.43% to close at 20,547.66. The Dow Jones Industrial Average closed 0.35% higher at 51,848.90, and the S&P 500 Index slipped 0.10% to 7,358.22, showing mixed performance among the major indices.

Concerns over short-term overheating in large-cap AI stocks led a broad decline in tech shares. Major tech companies like Microsoft, Oracle, and Meta saw their stock prices fall, with analysts suggesting this is a healthy correction and a recalibration of expectations following excessive gains in many stocks.

Conversely, international oil prices plummeted on expectations of normalized operations in the Strait of Hormuz, providing a positive tailwind for cyclical sectors. August delivery Brent crude futures fell 4.33% to $73.74 a barrel, and U.S. West Texas Intermediate (WTI) futures dropped 3.92% to $70.34 a barrel. The decline in oil prices led to expectations of reduced energy costs, driving gains in the airline and travel industries. The S&P 500 Airline Index surged 5.2%, and travel platform companies like Expedia and Booking Holdings also rose in tandem.

Furthermore, the drop in oil prices eased inflation concerns, contributing to stability in the bond market with U.S. 10-year Treasury yields falling 10 basis points to 4.40%. In foreign exchange markets, the dollar strengthened due to a combination of the U.S. Federal Reserve's interest rate outlook and a preference for safe-haven assets. The dollar index, which measures the dollar's value against a basket of six major currencies, hit a 13-month high, while the yen fell to its lowest level since 1986. This strong dollar trend led to a contraction in international spot gold prices and virtual asset markets like Bitcoin.

The market is closely watching the U.S. May Personal Consumption Expenditures (PCE) price index, due for release on the 25th. This is a key indicator for the Fed to gauge inflation trends, and its results could determine the Fed's future tightening path.