Microsoft is the IBD Stock Of The Day as the software giant gets a lift from artificial intelligence initiatives. MSFT stock was near a buy point on Wednesday.
On Friday, MSFT stock broke out of a flat base at a buy point of 276.86, according to IBD MarketSmith charts. But it dropped out of the buy zone in the next trading session. However, MSFT stock flirted with the buy zone on Wednesday.
On the stock market today, MSFT stock was up for much of the day, but ended the session down marginally to 272.29 after the Fed rate hike announcement.
The 5% buy zone from Microsoft's breakout runs from 276.86 to 290.70, based on IBD trading principles. However, if the breakout fails, the stop-loss sell zone starts at 257.48.
Artificial Intelligence News Boosts MSFT Stock
Microsoft shares surged last week after the company announced that it is adding artificial intelligence tools to its popular Office productivity applications. That follows the company's investments in AI startup OpenAI, the firm behind the buzzy ChatGPT application.
On Tuesday, graphics-chip maker Nvidia also revealed several collaborations with Microsoft.
Microsoft has partnered with Nvidia to deliver industrial metaverse and AI supercomputing resources to hundreds of millions of Microsoft enterprise users via the internet cloud.
Under the arrangement, Microsoft's Azure cloud infrastructure will host Nvidia's DGX Cloud service, which will provide AI as a service.
Azure also will host Nvidia's Omniverse Cloud, a platform for building and operating 3D virtual worlds. Omniverse is Nvidia's take on the so-called "metaverse." Through the partnership, Omniverse users will be able to connect with Microsoft 365 applications. Those Microsoft applications include Teams, OneDrive and SharePoint.
"Between next-generation immersive experiences and advanced foundational AI models, we see the emergence of a new computing platform," Microsoft Chief Executive Satya Nadella said in a news release.
He added, "Together with Nvidia, we're focused on both building out services that bridge the digital and physical worlds to automate, simulate and predict every business process, and bringing the most powerful AI supercomputer to customers globally."
Microsoft Stock Is A Long-Term Leader
MSFT stock has an IBD Composite Rating of 92 out of 99, according to IBD Stock Checkup. That means Microsoft is in the top 8% of stocks on key fundamental and technical measures.
Also, Microsoft stock is in the IBD Long-Term Leaders Portfolio.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
