Amazon profit surge amplifies AI‑driven volatility in the S&P 500

Amazon reported an unexpectedly strong earnings increase, largely attributed to its AI‑related investments. The gains include valuation and paper‑profit effects that have heightened volatility in the S&P 500’s profit‑growth trajectory.

Morgan Stanley strategist Michael Wilson argues that, despite a recent sell‑off in AI and semiconductor stocks, the broader rally will persist. He expects a leadership shift toward “quality” companies with stable earnings—such as insurers, medical‑technology firms and health‑service providers—and projects the S&P 500 could reach about 8,000 points by year‑end.