The Dow hits a record as most of Wall Street rises, but slumping AI
stocks keep indexes mixed
[July 03, 2026] By
STAN CHOE
NEW YORK (AP) — Most U.S. stocks rose on Thursday, and the Dow Jones
Industrial Average rallied to another record, but more drops for
computer chip companies and other winners of the artificial-intelligence
boom kept indexes mixed.
The S&P 500 finished the day virtually unchanged and edged up by less
than 0.1%, even though seven out of every 10 stocks within the index
rose. The Dow jumped 594 points, or 1.1%, while the Nasdaq composite
dropped 0.8% after erasing an early gain.
Stocks broadly got some help from a report showing that U.S. employers
added 57,000 jobs to their payrolls last month. That’s growth, which is
good for the economy, but it was also short of the 100,000 jobs that
economists expected and a slowdown from May’s hiring pace.
The bright side of the weaker-than-expected result is that it could keep
pressure off inflation, which has been accelerating worldwide because of
jumps in oil prices caused by the war with Iran. And now that oil prices
are back below where they were before the war, if inflation slows in
upcoming months, the Federal Reserve may feel less need to raise
interest rates several times this year.
That would be a relief for investors, who tend to love lower interest
rates because they can give the economy a boost by making it less
expensive for U.S. households and businesses to borrow money and spend.
Lower rates also tend to push upward on prices for stocks and other
investments.
The yield on the 10-year Treasury got to 4.50% in the morning, up from
3.97% just before the war. But after the release of the U.S. hiring
data, it immediately fell back to 4.46% before drifting to 4.48%.
Traders now see an 82% chance that the Fed and its new chairman, Kevin
Warsh, will not raise the federal funds rate at its next meeting later
this month. That’s up from the 71% chance seen a day earlier, according
to data from CME Group.
“The labor market isn’t overheating,” said Brian Jacobsen, chief
economic strategist at Annex Wealth Management. He said the data could
allow the Fed to wait through the summer to get more clues about how
inflation is behaving before having to decide on hiking rates.
On Wall Street, the company behind LaCroix sparkling waters climbed 7.5%
after National Beverage said it will pay a special dividend of $3.25 for
each share that investors hold.
Dollar Tree rose 2.4% after the retailer said it approved a program to
send up to $2.5 billion to its shareholders by buying back its stock.
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Trader Robert Charmak works on the floor of the New York Stock
Exchange, Friday, June 26, 2026. (AP Photo/Richard Drew)
 Stocks of companies in the crypto
industry were also strong after the price of bitcoin rose roughly
2%, a day after dropping near its lowest level since 2024. Robinhood
Markets rose 3.8%, and Coinbase Global gained 3.9%.
But more drops for computer chip companies weighed on indexes.
They’ve come under pressure because of worries that their stock
prices shot too high in the frenzy around AI and that all the
spending on chips and data centers may not result in as much profit
and productivity growth as hoped.
Memory maker Micron Technology erased an early gain to drop 5.5%, a
day after plunging 10.6%. Nvidia fell 1.4%, and Lam Research sank
10.2%. They were some of the heaviest weights on the S&P 500 because
they’ve grown so huge in size amid AI mania.
Nvidia has a total value of nearly $4.7 trillion, for example, which
means that its stock’s movements have more weight on the S&P 500
than any other.
All told, the S&P 500 rose 0.01 to 7,483.24 points. The Dow Jones
Industrial Average rallied 594.83 to 52,900.07, and the Nasdaq
composite sank 207.36 to 25,382.67.
In stock markets abroad, continued drops for chip companies sent
indexes sharply lower in several Asian markets. South Korea’s Kospi
index sank 7.9% due to losses for companies like SK Hynix. That’s
its worst drop since a 10% plunge a little more than a week ago.
Indexes also fell 2.5% in Tokyo and 2% in Shanghai.
European indexes were stronger, and France’s CAC 40 rallied 1.7%.
In the oil market, prices dropped in the morning but pared their
losses as the day progressed. Brent crude, the international
standard, settled at $71.80 per barrel, up 0.3%.
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AP Business Writers Chan Ho-him and Matt Ott contributed to this
report.
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