S&P 500, Nasdaq finish increased, pushed by tech shares

By Sruthi Shankar, Johann M Cherian and Carolina Mandl

(Reuters) -The S&P 500 and the Nasdaq Composite rose on Monday to greater than one-week highs, boosted by a rally in semiconductor shares and a report that urged the incoming Trump administration may undertake a much less aggressive tariff stance than anticipated.

The Dow Jones Industrial Common fell 25.57 factors, or 0.06%, to 42,706.56, the S&P 500 gained 32.91 factors, or 0.55%, to five,975.38 and the Nasdaq Composite gained 243.30 factors, or 1.24%, to 19,864.98.

Seven of the 11 S&P 500 sectors ended decrease, however communication companies and tech shares climbed 2.13% and 1.44%, respectively.

“What we’re seeing is extra of what occurred final yr, which is a rally focused on the most important shares,” stated Michael Inexperienced, portfolio supervisor at Simplify Asset Administration, including that flows from 401(okay) retirement plans are serving to drive shares increased.

Chipmakers bought a lift from Microsoft (NASDAQ:MSFT)’s plan to speculate $80 billion to develop artificial-intelligence-enabled information facilities, in addition to Foxconn (SS:601138)’s forecast-beating fourth-quarter income.

Nvidia (NASDAQ:NVDA) rose 3.43%, Superior Micro Gadgets (NASDAQ:AMD) gained 3.33% and Micron Know-how (NASDAQ:MU) was up 10.45%. The Philadelphia Semiconductor index jumped 2.84%.

Tech shares rose regardless of benchmark 10-year Treasury yields reaching the best since Might.

U.S. shares had rebounded sharply on Friday after a string of losses in December and the primary few periods of January, when issues about excessive valuations, rising Treasury yields and skinny liquidity noticed merchants pull again after a powerful 2024 run.

Automakers gained, with Ford (NYSE:F) rising 0.40% and Normal Motors (NYSE:GM) including 3.40% after a newspaper report stated President-elect Donald Trump’s incoming administration is targeted on imposing tariffs on each nation, however solely sure sectors deemed crucial to nationwide or financial safety. Trump later refuted the report.

“He did come out and say that he isn’t going to water down his tariff plan, however the seed has been planted that the Trump administration’s tariff insurance policies will not be fairly as stunning as individuals initially feared,” stated Brian Jacobsen, chief economist at Annex Wealth Administration.

Vehicle producers are thought of essentially the most weak to tariffs imposed on U.S. commerce companions, given their huge provide chains.

Resulting in Trump’s Jan. 20 inauguration, traders are looking for insights into his insurance policies, that are broadly seen as helpful for company America in addition to the U.S. financial system.

Citigroup (NYSE:C) moved 2.45% increased after a bullish ranking from Barclays (LON:BARC). An index monitoring banks rose 0.22%. Fed Vice Chair for Supervision Michael Barr, who has sought a spread of strict guidelines on the nation’s greatest banks, stated he’ll resign.

In per week filled with financial information and speeches from U.S. Federal Reserve officers, traders will search for clues on the tempo of financial coverage easing this yr. Later within the week, the main focus will probably be on a month-to-month payrolls report.

Whereas Trump’s proposals may enhance company earnings and energize the financial system, additionally they threat driving up inflation. Fed Governor Lisa Prepare dinner was the most recent amongst numerous policymakers to warning that inflation dangers stay within the new yr.

Advancing points outnumbered decliners by a 1.01-to-1 ratio on the NYSE and a 1.1-to-1 ratio on the Nasdaq.

The S&P 500 posted eight new 52-week highs and eight new lows, whereas the Nasdaq Composite recorded 97 new highs and 39 new lows.

Quantity on U.S. exchanges was 17.36 billion shares, in contrast with the 12.37-billion common during the last 20 buying and selling days.

Markets will probably be shut on Thursday for a nationwide day of mourning to mark the loss of life of former President Jimmy Carter.