Nasdaq hits record close on AI stocks and lower oil prices
The Nasdaq composite index posted a record-high close on Monday, driven by gains in Nvidia and Microsoft, as investors focused on falling oil prices and looked ahead to third-quarter earnings. The S&P 500 also rose, ending about 0.3 per cent below its August record close.
The Nasdaq composite index notched a record-high close on Monday, lifted by gains in Nvidia and Microsoft, as investors focused on a dip in oil prices and looked ahead to quarterly earnings reports. It was the Nasdaq's second day of sharp gains after weaker-than-expected jobs data on Friday dampened expectations for an interest rate hike from the Federal Reserve at its policy meeting this month.
AI heavyweight Nvidia climbed 2.1 per cent and also reached a record-high close, boosting its stock market value to US$5.76 trillion. Microsoft added 1.5 per cent, while Meta Platforms and Tesla gained about 2 per cent each. Oil prices slipped after crude exports from the Middle East increased and the Group of Seven nations pledged to boost supplies.
“With the economic data calendar being light and earnings about a week away, investors are really groping for anything positive to glom onto, and clearly they're looking at lower energy prices,” said Art Hogan, chief market strategist at B. Riley Wealth.
The S&P 500 climbed 0.66 per cent to end the session at 7,773.95 points. The Nasdaq gained 1.05 per cent to 27,477.31 points, while the Dow Jones Industrial Average rose 0.18 per cent to 51,267.90 points. The S&P 500 was about 0.3 per cent below its 13 August record high close. The Nasdaq’s previous record high close was on 22 September.
Third-quarter earnings season kicks off next week with reports from large US banks. Analysts on average see S&P 500 earnings jumping over 30 per cent year over year, thanks largely to AI-related stocks, according to LSEG data. Following jobs data on Friday that showed US job growth slowed more than expected in September, traders see a 24 per cent chance of an interest rate hike at the Fed’s October meeting, down from a 70 per cent chance a week ago, according to CME’s FedWatch tool.
PTC surged 33 per cent after France’s Schneider Electric agreed to acquire the software firm in a US$22.6 billion all-cash deal. RXO jumped over 22 per cent after logistics firm C.H. Robinson Worldwide agreed to buy the transportation broker in a stock-and-cash transaction for US$5.8 billion. Cerebras Systems rose 9 per cent after OpenAI CEO Sam Altman said on social media the chip designer is a “close partner” and that the companies have “deep engagement pushing on the frontiers of speed.”
Ten of the 11 S&P 500 sector indexes rose, led by materials, up 1.22 per cent, followed by a 1.14 per cent gain in communication services. Volume on US exchanges was relatively light, with 16.8 billion shares traded, compared to an average of 17.3 billion shares over the previous 20 sessions.