Quantum stocks rose today because the US government is investing $2 billion in grants to nine companies working on quantum computing.
The National Institute of Standards and Technology said it had signed letters of intent with the companies. The US government will also take minority stakes in each company, but these stakes will not give it control.
The biggest prize will go to IBM (IBM), which is set to receive $1 billion from the Commerce Department. IBM shares traded nearly 7% higher after the announcement.
IBM backs Anderon as US funds new quantum chip foundry
IBM is one of the major public companies building quantum computers. These devices are designed to handle problems that regular computers have or can’t solve at all.
After the Wall Street Journal reported the financing plan, I.B.M certain They will work with the US government on the country’s first purpose-built quantum foundry.
IBM said the project “will accelerate American quantum innovation and enable the production of advanced quantum chips for a wide range of companies.”
The Department of Commerce grant will support research and development at Anderon, a new IBM subsidiary. IBM said it will also invest $1 billion in Anderon, which matches the planned government grant.
Anderon will be based in Albany, New York, and operated as a separate company. “Anderon will be headquartered in Albany, New York as an independent company, and will operate as a cutting-edge foundry for 300mm quantum chips,” IBM said.
IBM also said the business will help the United States strengthen its position in the quantum industry that could create up to $850 billion in economic value by 2040. The company also linked the project to American economic growth and national security.
Other companies receive smaller awards. GlobalFoundries (GFS) is set to raise $375 million. D-Wave Quantum (QBTS), Rigetti Computing (RGTI), and private company Infleqtion are each expected to raise $100 million. Startup Diraq is reportedly in the running for $38 million.
The stock reaction was not calm. D-Wave and Rigetti are both up about 25%. Reflection increased by approximately 30%. It also acquired other quantitative names that were not included in the grant announcement. Arqit Quantum (ARQQ) shares are up 30%, IonQ (IONQ) shares are up 12%, and Quantum Computing (QUBT) shares are up 17%.
Traders are lifting major indexes while oil and Treasury yields remain unstable
The broader US stock market also ended higher on Thursday. The Dow Jones Industrial Average rose 276.31 points, or 0.55%, and closed at a record level of 50,285.66 points. The Standard & Poor’s 500 index rose 0.17% to 7,445.72 points. The Nasdaq Composite Index added 0.09% and closed at 26,293.10.
Oil prices fell even as the market remained nervous about the conflict in the Middle East. West Texas Intermediate crude futures fell nearly 2% to close at $96.35 per barrel. Brent crude fell more than 2%, closing at $102.58 a barrel. Treasury yields were also volatile as traders watched for any sign of a deal.
IEA Executive Director Fatih Birol warned that oil markets may soon enter the “red zone.” Fatih said global inventories are declining while summer travel raises demand.
Fateh said that the main response to the energy shock in the Iranian war is to fully and unconditionally reopen the Strait of Hormuz. He said that if the road is not reopened, and if new supplies of oil do not arrive in the Middle East, oil markets “could enter the red zone in July or August.”
He made these statements at a Chatham House session on the Strait of Hormuz crisis and global energy security. The International Energy Agency said that the global oil market is facing the worst turmoil in its history. Al-Fatih said the market had extra supplies when the crisis began, which helped cushion the blow, but those stocks are now shrinking.
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