The Nasdaq Composite closed at a record Monday as Nvidia, Microsoft and other major technology stocks advanced, while lower oil prices and reduced expectations for an October Federal Reserve rate hike helped lift broader markets.
By yourNEWS Media Newsroom.
NEW YORK — The Nasdaq Composite closed at a record high Monday as gains in Nvidia, Microsoft and other major technology companies pushed Wall Street higher, while investors welcomed lower oil prices and looked ahead to the start of third-quarter earnings season.
The Nasdaq climbed 1.05% to close at 27,477.31, surpassing its previous record closing high set Sept. 22.
The S&P 500 gained 0.66% to finish at 7,773.95, leaving the benchmark about 0.3% below its Aug. 13 record close. The Dow Jones Industrial Average advanced 0.18% to 51,267.90, according to Monday’s market results.
Ten of the S&P 500’s 11 major sectors finished higher, with materials and communication services posting the strongest gains.
The technology-heavy Nasdaq was led by another strong performance from some of the market’s largest artificial intelligence and growth stocks.
Nvidia rose 2.1% and reached its own record closing high, lifting the semiconductor company’s market capitalization to approximately $5.76 trillion.
Microsoft gained 1.5%, while Meta Platforms and Tesla each rose about 2%.
Monday marked the Nasdaq’s second consecutive session of sharp gains following weaker-than-expected September employment figures released Friday.
The jobs report reduced investors’ expectations that the Federal Reserve will raise interest rates again at its October policy meeting.
Traders were pricing in a 24% probability of an interest-rate increase this month, down sharply from about 70% a week earlier, according to CME’s FedWatch tool.
The shift in rate expectations has been particularly supportive for technology and other growth-oriented stocks, whose valuations tend to be sensitive to borrowing costs.
Oil prices provided another boost to investor sentiment.
Crude prices declined Monday after exports from the Middle East increased and Group of Seven nations pledged to boost supplies.
Brent crude settled near $100 a barrel after falling roughly $2 during the session, while U.S. West Texas Intermediate also declined.
Lower energy prices can ease pressure on consumers and businesses while reducing concerns that fuel costs will add further to inflation.
“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 easing in oil prices follows weeks of heightened volatility caused by the U.S. war with Iran, disruptions to Middle Eastern energy infrastructure and uncertainty surrounding shipping through the Strait of Hormuz.
Despite Monday’s decline, energy prices remain elevated compared with levels before the conflict.
Treasury yields also remain high, creating a competing pressure on equities.
U.S. stocks have nevertheless outperformed many international markets over the past six months, supported by strong corporate profits and continued investor enthusiasm surrounding artificial intelligence.
Attention is now turning toward corporate earnings.
Third-quarter reporting season begins next week, with several of the country’s largest banks scheduled to announce results.
Analysts surveyed by LSEG expect S&P 500 companies collectively to report earnings growth of more than 30% from the same quarter a year earlier.
Much of that increase is expected to come from technology companies and businesses benefiting from the continuing surge in AI investment.
Investors will be watching whether earnings growth is broad enough to support stock valuations that have climbed considerably during the year.
Monday’s rally showed continued concentration among the market’s largest technology names, but market breadth was also positive.
Advancing stocks outnumbered declining stocks within the S&P 500 by approximately 1.7 to 1.
Materials stocks rose 1.22%, while communication services advanced 1.14%.
Several individual companies also posted major moves following acquisition announcements.
Software company PTC surged about 33% after France’s Schneider Electric agreed to acquire the company in a $22.6 billion all-cash transaction.
The deal expands Schneider’s industrial software business as the French company looks to benefit from increased investment in automation, electrification and artificial intelligence infrastructure.
Transportation broker RXO gained more than 22% after C.H. Robinson Worldwide agreed to acquire the company for approximately $5.8 billion in cash and stock.
C.H. Robinson fell nearly 11% following the announcement.
Cerebras Systems advanced about 9% after OpenAI CEO Sam Altman publicly highlighted the artificial intelligence chip company’s relationship with OpenAI.
Altman described Cerebras as a “close partner” and said the companies have “deep engagement pushing on the frontiers of speed.”
Cerebras designs computing systems intended to compete in parts of the rapidly expanding market for artificial intelligence infrastructure dominated by Nvidia and other semiconductor companies.
The AI investment boom remains a central driver of U.S. equity markets.
Companies involved in chips, cloud computing, data centers and software have accounted for a substantial portion of corporate earnings growth and stock-market gains.
That strength has helped offset concerns about high Treasury yields, persistent inflation and the economic consequences of conflict in the Middle East.
Monday’s gains also came against a complicated economic backdrop.
Friday’s employment report showed job creation slowing more than economists expected in September, raising questions about whether the labor market is beginning to lose momentum.
Ordinarily, weaker employment data could weigh on stocks.
Instead, investors focused on the implications for Federal Reserve policy.
A softer labor market makes another immediate interest-rate increase less likely, reducing one of the principal pressures facing high-valued technology stocks.
That dynamic contributed to Friday’s rally and carried into Monday.
Investors still face uncertainty over whether the Fed can keep inflation under control without slowing economic growth too sharply.
Recent business surveys have shown continued expansion in both manufacturing and services, while also pointing to renewed increases in input costs.
Higher energy prices, transportation expenses and labor costs remain potential sources of inflation.
The Federal Reserve’s decision later this month will therefore depend on a combination of employment, inflation and broader economic data.
For Wall Street, earnings will take center stage in the meantime.
Strong profits have helped sustain U.S. equities despite rising interest rates and geopolitical instability.
The S&P 500 is now again within striking distance of its record high, while the Nasdaq has already pushed into new territory.
Monday’s session reinforced the market’s continuing reliance on major technology companies, particularly Nvidia and Microsoft, but also showed broader participation across most sectors.
The immediate combination of lower oil prices, reduced expectations for another Fed rate increase and optimism over upcoming corporate earnings gave investors enough reason to keep buying.
By the closing bell, that was enough to send the Nasdaq to its highest finish on record.
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