Dell Surges on AI Demand, Energy Stocks Climb as Broader Market Falters

U.S. equity markets are on track for a weekly loss as a surge in crude oil prices above $100 per barrel, driven by escalating Middle East tensions, weighed on investor sentiment. Amid the broader downturn, specific company developments in artificial intelligence, energy, and index inclusion drove significant divergence in individual stock performance.

AI and Index Catalysts Lift Tech Names

Dell Technologies (DELL) was a standout performer, climbing 8.8% for the week after the company provided a bullish update on demand for its AI servers. At a Goldman Sachs conference on Wednesday, CFO David Kennedy reported that second-quarter AI server bookings reached $6.1 billion, a figure that matched the total from the previous three quarters combined. The company's 12-month AI booking total now stands at $13.2 billion, with an AI infrastructure backlog of $95 billion. Dell's stock was also boosted by its addition to the S&P 100 index.

Other notable movers included:

• Bloom Energy (BE): The stock surged 16.3% over the week following an announcement from S&P Dow Jones Indices that it will join the S&P 500. The inclusion, effective before the market opens on Monday, September 21, is a "significant positive catalyst" that will likely increase passive fund ownership, according to an analyst note from UBS.
• Meta Platforms (META): Shares rose 6.1% for the week after the company released Muse Spark 1.3, a major update to its AI model. CEO Mark Zuckerberg highlighted the model's performance and cost-efficiency, noting it was the company's largest improvement in coding capabilities.

Energy Sector Rallies With Crude Oil

Ad

Energy stocks advanced as geopolitical tensions in the Middle East reportedly involving Houthi forces in Yemen pushed crude prices higher. Brent crude futures briefly surpassed $109 a barrel on Thursday before settling above $104.

The rally lifted major producers, with Marathon Petroleum (MPC) leading the group with a 4.5% weekly gain. Other gainers included Exxon Mobil (XOM), up 2.8%, Chevron (CVX), which added 2.0%, and both Occidental Petroleum (OXY) and ConocoPhillips (COP), which rose 1.5%.

Oracle Slips Despite Earnings Beat

In contrast to the week's winners, Oracle (ORCL) shares declined 4.4% for the week, reversing initial post-earnings gains. The software giant reported first-quarter results on Thursday that surpassed analyst expectations, with earnings of $1.92 per share versus a $1.73 consensus and revenue of $19.3 billion topping estimates of $19.13 billion.

However, the company's guidance for third-quarter earnings of $1.83 to $1.91 per share straddled the consensus estimate of $1.89, which may have tempered investor enthusiasm. Despite the stock's negative reaction, some analysts remain positive, with Guggenheim reiterating a Buy rating and a $400 price target, citing details from management that point to a "brighter future."