US stocks are "divergent".

On November 3rd (ending early morning of November 4th, Vietnam time), the US stock market witnessed a clearly divergent session: the two major indices, the S&P 500 and Nasdaq Composite, rose, while the Dow Jones Industrial Average declined. The main reasons are seen as the surge in investment in technology and AI, particularly the deal between Amazon and OpenAI, coupled with the increasingly uncertain outlook for the Federal Reserve's (Fed) monetary policy.

Technology stocks propelled the Nasdaq and S&P 500 higher.

At the close, the S&P 500 rose about 0.2%, nearly touching the record high set last week, although most of its constituent stocks still declined. The Nasdaq gained about 0.5%, led by technology stocks. Conversely, the Dow Jones fell about 226 points (0.5%) due to the impact from the healthcare sector and large non-technology stocks.

AI leads the market.

One of the clear highlights of the session was trading related to technology and AI. Amazon announced a $38 billion deal with OpenAI, under which OpenAI will use Amazon's cloud computing service (AWS) to operate and scale its AI workloads. Amazon shares rose about 4% during the session, providing strong support for the S&P 500 overall.

On the pure technology side, Nvidia Corporation (NVDA) also rose about 2.2% in the session, bringing its year-to-date gain to over 54%. This continues to be the main driving force helping the technology index and the S&P 500 maintain their positive performance.

However, not the entire market was in agreement: the healthcare sector saw sharp declines, with two major players, UnitedHealth Group (down 2.3%) and Merck & Co. (down 4.1%), dragging the Dow into negative territory.

Additionally, M&A activity was also prominent, with Kimberly-Clark Corporation shares plummeting 14.6% after announcing its intention to acquire Kenvue ($48.7 billion). Conversely, Kenvue rose 12.3%. This demonstrates the market's strong reaction to major news, but also warns of significant divergence between leading stocks and the rest.

Although the market saw major indices close slightly higher, the macroeconomic fundamentals remain uncertain. Official economic data in the US remains scarce due to the largely shut-off government, making the Fed's next steps look bleak.

Fed officials sent rather mixed signals: on the one hand, Governor Stephen Miran remained open to further interest rate cuts; on the other hand, Chicago Fed President Austan Goolsbee said he did not support further rate reductions while inflation remained above the 2% target. Newly released ADP employment data and Purchasing Managers' Index (PMI) figures showed that the US manufacturing sector is still grappling with uncertainty from tariffs and supply chain disruptions.

The absence of major economic indicators, coupled with inconsistent statements from the Fed, leaves investors wondering: will the Fed cut interest rates by the end of the year, or will it wait for further evidence of cooling inflation and weakening employment? The answer remains very uncertain.

Trading developments & market overview

Total trading volume across US exchanges was approximately 19.62 billion shares, lower than the 20-day average (21.11 billion), indicating relatively weak participation. On the NYSE, the number of declining stocks exceeded the number of rising stocks at a ratio of 1.34:1; on the Nasdaq, this ratio was 1.6:1.

Meanwhile, the S&P 500 recorded 16 new 52-week highs and 32 new lows; the Nasdaq recorded 74 new highs and 181 new lows, indicating that, despite strong gains in leading stocks, the broader market trend is not yet fully unified.

In particular, the third-quarter earnings reporting season is going quite well: approximately 83% of S&P 500 companies have beaten forecasts. More than two-thirds of companies are reporting earnings growth that is expected to be 11% year-over-year.

From a financial reporter's perspective, the November 3rd session was seen as a "harmonious ending": major indices didn't surge sharply, but neither did they plunge deeply, mainly thanks to support from the technology and AI sectors. However, the market is entering a more selective phase than ever before, and investors cannot simply "hold" onto leading stocks while ignoring fundamental risks.

It is worth noting:

- Firstly, technology/AI stocks are playing a key role in market trends, but market breadth remains narrow – if the index rises mainly due to a few large-cap stocks, the risk will be greater if the market reverses.

Secondly, the macroeconomic outlook lacks clarity: a lack of strong economic data and ambiguity in the Fed's monetary policy all cast doubt on the timing of whether to "cut interest rates" or "keep them unchanged."

- Thirdly, while profit growth is considered strong, stock valuations, especially in the AI/technology sector, are becoming very expensive – there are quite a few warnings about a dot-com bubble.

- Finally, large corporate deals like Amazon-OpenAI or Kimberly-Clark/Kenvue may provide a short-term boost but also create additional market differentiation and risk – investors need to consider both the actual business results and the sustainability of the growth story.

The trading session on November 3rd clearly demonstrated the reality of "leading the way in technology while the foundations remain weak." The S&P 500 and Nasdaq ended higher, boosted by the Amazon-OpenAI deal and the AI ​​community, but the Fed's path ahead is increasingly bleak, monetary policy remains uncertain, economic data is weak, and market valuations are already high. This puts investors in a more selective position, urging them not to be complacent in the "AI is everything" narrative but to carefully assess the growth trajectory, valuations, and underlying risks.

Source: https://thoibaonganhang.vn/chung-khoan-my-chia-dong-172995.html