AMD Joins the $1 Trillion Club as 10-Year Yields Climb Past 5%
Daily Wrap
Analysis
Rising rates and stretched valuations have not slowed the artificial-intelligence trade. The Fed's latest rate hike pushed the 10-year Treasury yield back above the 5% mark, and the broad index's cyclically adjusted multiple now sits at its highest reading since the late-1990s bubble burst. Yet the tape's center of gravity keeps marching higher: AMD became another milestone winner, clearing the $1 trillion market-cap threshold after a 194% advance on the year, while major technology firms are tapping the bond market at record levels to finance AI infrastructure. The news flow pointed the same direction. Beijing is reportedly weighing permission for ByteDance and Alibaba to purchase newer Nvidia silicon — a possible re-opening of one of the chipmaker's most valuable customer pools. In Omaha, Greg Abel flipped Berkshire Hathaway into a net equity buyer for the first time in 14 quarters, adding roughly $20 billion of net positions last quarter. That included a $10 billion commitment to an Alphabet private round, lifting the conglomerate's GOOGL holding to about $38 billion and making it the firm's third-largest position. Strategists are also arguing that the hands-on AI effort at Meta could trigger a re-rating of the shares. The tape itself was mixed, with strength clustered in pockets. AESI led the gainers with a 13.5% jump to $12.47, while PPLI (+11.3%), WNC (+11.3%), GENI (+11.0%) and BE (+8.3% to $288.70) also posted solid moves; on the losing side, ONT sank 16.8% and Zscaler (ZS) gave back 10.1% to $193.05. Volume concentrated in the big caps — Intel finished down 3.5% at $123 on roughly 98 million shares, Nvidia edged up 0.2% to $225.07 on about 90 million, and Tesla faded 1.5% to $372.11. The calendar ahead carries Tesla's third-quarter delivery count, due in the first week of October, along with two further tests of AI spending and the broader economy that the Street is watching.
Highlights
- AMD cleared the $1 trillion market-cap milestone, extending a 194% year-to-date run into rarefied company
- Berkshire Hathaway snapped a 14-quarter run of net stock selling: Greg Abel added a net ~$20 billion of equities last quarter, including a $10 billion Alphabet commitment
- Beijing is reportedly weighing permission for ByteDance and Alibaba to purchase newer Nvidia silicon, a possible expansion of one of the chip giant's most valuable customer pools
Lowlights
- The 10-year Treasury yield climbed above 5% after the Fed's newest hike, ratcheting up the hurdle for richly valued growth shares
- Valuations are stretched: the index's cyclically adjusted multiple hit its widest reading since the dot-com era, a historical warning for forward returns
- Several software names sold off hard — ONT -16.8% to $14, ZS -10.1% to $193.05, TWLO -8% to $275.80 — while the signals scan leans cautious with 26 bearish flags versus 23 bullish
Bull News
- Berkshire Hathaway became a net equity buyer again after 14 straight quarters of net selling, with the swing headlined by a $10 billion Alphabet round that is now the firm's third-largest position
- Strategists see the social giant's fresh Muse AI model as the start of a possible multiple re-rating, with one analyst citing Zuckerberg's wartime footing as the catalyst
- Record tech bond issuance shows balance-sheet confidence to keep funding AI buildouts, and a roundtable in biotech points to an innovation-led up-market ripening in the space
Bear News
- With the 10-year now above 5% following the Fed's newest hike, expensive growth names face a steeper financing hurdle
- Apple faces a $5.7 billion legal bill tied to a tiny iPhone and Watch feature, as Tim Cook prepares to step down as CEO
- JPMorgan is stalling this year after a decade that delivered a 572% return — a reminder that the past is no guide to the next leg
The setup is stretched-but-strong. AI strength is undeniable — AMD's $1 trillion market cap, Beijing's possible re-opening of Nvidia sales to Chinese AI buyers, and Berkshire's swing into net buying (roughly $20 billion last quarter, including $10 billion on Alphabet) all argue the leaders still attract money. But a 10-year yield back above 5%, a CAPE multiple at its widest since the dot-com era, and a signals scan that edges bearish (26 versus 23 across 1,537 flags on 2,591 symbols, with MRNA at $198.88 among the most overbought) tilt the technicals toward caution. Into the week, the third-quarter vehicle hand-overs from Tesla, due in the first week of October, and two scheduled reads on AI investment and the macro backdrop should set direction; until then, expect the tape to stay led by AI hardware — Nvidia ($225.07, +0.2% on about 90M shares) and Intel ($123, -3.5% on the heaviest 98M) — and positioning that favors selective strength over broad exposure.