CNBC Daily Open: Alphabet to omega in AI?

Alphabet on Monday resuscitated the artificial intelligence trade, which had been flagging the previous week. Its stock jumped 6.3%, lifting associated AI names such as Broadcom, Micron Technology and AMD. Major indexes rallied, with the Nasdaq Composite posting its best day in six months.

Investors were particularly enthusiastic about Broadcom because it helps to design and manufacture Google-parent Alphabet’s custom AI chips. In other words, the more market share Alphabet’s AI offerings gain, the greater the benefit to Broadcom — rather like Nvidia and the broader AI sector at the moment. Broadcom shares surged 11.1% on this notion, making it the S&P 500’s top gainer.

But while investors may cheer Alphabet’s leadership on Monday, not everyone wants it to have the last word.

“Some investors are petrified that Alphabet will win the AI war due to huge improvements in its Gemini AI model and ongoing benefits from its custom TPU chip,” Melius Research analyst Ben Reitzes wrote to clients in a Monday note. “GOOGL winning would actually hurt several stocks we cover — so prepare for volatility.”

Approaching the market’s moves from another angle, Melissa Brown, managing director of investment decision research at SimCorp, said it’s a concern when just one stock lifts the market. “That just doesn’t seem to me to be a sustainable force behind driving the market higher over the next however many days,” she added.

Alphabet on Monday may have brought about alpha — in the sense of market outperformance and potentially beginning a new phase of AI enthusiasm — but letting it be the omega as well could pose problems for investors.

U.S. tech stocks roar back. The Nasdaq Composite popped 2.69%, its best day since May 12, on investors enthusiasm over Alphabet. Other major indexes rose in tandem. Asia-Pacific markets were mostly Tuesday as AI-related stocks ticked up.

Record outflows from BlackRock’s bitcoin ETF. The iShares Bitcoin Trust ETF has seen an exodus of $2.2 billion this month as of Monday stateside, according to FactSet data. That’s almost eight times more in losses than last October, or its second-worst month on record.

Sandisk joins the S&P 500. The flash storage vendor will replace marketing company Interpublic Group in the index before trading begins on Nov. 28 stateside. Shares of Sandisk jumped 7% in extended trading on Monday.

Trump has back-to-back calls with Xi and Takaichi. But the Beijing-Tokyo spat is unlikely to be resolved soon. U.S. President Donald Trump has stayed publicly silent, adding uncertainty for Japan and Taiwan at a tense moment. 

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