SMCI - Why Super Micro Computer C3.ai and Other Artificial Intelligence (AI) Stocks Rallied This Week
2024-05-17 18:18:21 ET
There's little question that one of the prevailing forces that has been driving the market higher over the past year is the advancement of artificial intelligence (AI) . Countering investors' exuberance about the prospects for that technology are concerns about the Federal Reserve's ongoing battle with inflation. Interest rates remain at a two-decade high, and investors are keenly interested in the timing and potential for the central bank to begin cutting them. The central bank has signaled that it's in no rush to reduce the benchmark federal funds rate -- at least, not until inflation subsides sufficiently. The government's latest monthly read on inflation helped fuel investors' hopes, sparking a broad-based market rally.
With that as a backdrop, AI server specialist Super Micro Computer (NASDAQ: SMCI) , also called Supermicro, surged by 11.2% this week, AI solutions provider C3.ai (NYSE: AI) gained 10.5%, and data mining and analytics provider BigBear.ai (NYSE: BBAI) climbed 8.6%, according to data provided by S&P Global Market Intelligence .
A check of all the usual sources -- regulatory filings, earnings results, and changes to analysts' ratings and price targets -- turned up nothing in the way of company-specific news that could have been driving these AI stocks higher this week. This seems to suggest that most investors who were propelling their climbs were giddy about the incremental improvements to the state of the U.S. economy.
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Why Super Micro Computer, C3.ai, and Other Artificial Intelligence (AI) Stocks Rallied This Week