By Emmanuel Bobby
U.S. stock markets edged higher on Monday, following strong rallies across Asia earlier in the day. The S&P 500 gained 0.5%, inching closer to its all-time high set just two weeks ago. The Dow Jones Industrial Average added 20 points, a modest increase of less than 0.1%, while the Nasdaq composite climbed 0.9%, boosted by technology and chipmakers.
The modest gains in the U.S. came after a dramatic 3.9% surge in Japan’s Nikkei 225, which hit a record high. The rally followed a decisive victory for Prime Minister Sanae Takaichi’s political party in Japan’s parliamentary elections. Investors are optimistic that Takaichi will have the political capital to push through economic reforms designed to stimulate growth and strengthen the stock market.
Despite recent gains, Wall Street still faces lingering concerns. Analysts caution that U.S. stocks may be overvalued after hitting record levels. Investors are also closely watching corporate spending on artificial intelligence technology, questioning whether the massive investments will translate into long-term profits.
On Monday, some of the companies benefiting from the AI boom helped lift the market. Chipmakers were among the top performers, with Nvidia rising 2.4% and Broadcom climbing 3.3%, both contributing significantly to the S&P 500’s advance.
Retailers also made headlines. Kroger surged 3.9% after appointing a former Walmart executive as its new CEO, signaling potential strategic changes for the grocer. In the energy sector, Transocean reversed early losses to rise 5.9% following an announcement that it would acquire Valaris in an all-stock deal valued at $5.8 billion. Valaris shares skyrocketed 34.3% on the news.
On the downside, Hims & Hers plunged 16% after Novo Nordisk filed a lawsuit alleging the company is illegally selling versions of its popular weight-loss treatments. The lawsuit comes after the U.S. Food and Drug Administration restricted access to key ingredients for these medications. Hims & Hers responded, claiming that “Big Pharma is weaponizing the U.S. judicial system to limit consumer choice.” Novo Nordisk’s U.S.-traded stock, by contrast, rose 3.6%.
Workday also fell 5.1% after CEO Carl Eschenbach announced he would step down. Co-founder Aneel Bhusri will return as chief executive, marking a leadership transition for the AI-focused software company.
By the close of trading, the S&P 500 had added 32.52 points to 6,964.82. The Dow Jones Industrial Average rose 20.20 points to 50,135.87, and the Nasdaq composite gained 207.46 points to 23,238.67.
In the bond market, Treasury yields remained mostly steady ahead of potentially market-moving economic reports later in the week. Investors are anticipating Wednesday’s monthly update on the U.S. labor market and Friday’s consumer-level inflation report. Both releases could influence expectations for the Federal Reserve’s interest rate policy. The Fed has paused rate cuts, but a weakening job market could accelerate reductions, while high inflation might extend the current pause. The 10-year Treasury yield eased slightly to 4.20% from 4.22% late Friday.
Other markets reflected signs of stability. Gold rose 2% to $5,079.40 per ounce after a volatile period that saw prices fluctuate between $4,500 and nearly $5,600 over the past year. Silver jumped 6.9%, continuing a recent trend of sharp swings. Bitcoin hovered just below $71,000, recovering from a drop near $60,000 last week, which was more than halfway down from its October record.
International markets also saw gains. In Asia, Japan’s Nikkei surge was matched by South Korea’s Kospi, which rose 4.1%. Hong Kong stocks climbed 1.8%, and Shanghai added 1.4%. European markets were more moderate, with Germany’s DAX up 1.2% and France’s CAC 40 rising 0.6%.
Overall, Monday’s trading reflected a cautious but positive mood for investors, buoyed by global optimism while still facing uncertainties over corporate spending, valuation levels, and upcoming U.S. economic data.
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