US STOCKS-Nasdaq ends sharply higher as Tesla soars on AI optimism

Hostess Brands

11/09/2023 21:16

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        * 
      Tesla rallies on Morgan Stanley upgrade
    

        * 
      Qualcomm climbs after deal to supply 5G chips to Apple
    

        * 
      Hostess Brands up after J.M. Smucker's $5.6 bln buyout
deal
    

        * 
      Indexes: S&P 500 +0.67%, Nasdaq +1.14%, Dow +0.25%
    

  
 (Updated at 4:10 p.m. ET/ 20010 GMT)
    By Noel Randewich and Shristi  Achar A
       Sept 11 (Reuters) - The Nasdaq closed sharply higher on
Monday as Tesla surged on optimism around artificial
intelligence and investors awaited inflation data due later this
week.
    Tesla  TSLA.O  rallied 10% after Morgan Stanley upgraded the
electric car maker to "overweight" from "equal-weight," saying
its Dojo supercomputer could boost the company's market value by
nearly $600 billion.
    Other megacaps also rose, with Amazon  AMZN.O  climbing 3.5%
and Microsoft  MSFT.O  adding 1.1%.
    Meta Platforms  META.O  jumped 3.25% after a report on
Sunday said the social media platform was working on a new, more
powerful AI system.
    Walt Disney  DIS.N  added 1.2% and Charter Communications
 CHTR.O  rose 3.2% after they reached a deal for Disney's
programming, including ESPN, to return to the Spectrum cable
service just hours ahead of the start of NFL "Monday Night
Football."
    Investors are looking to August consumer price index data
due on Wednesday for clues about how close the Federal Reserve
may be to ending its campaign of interest rate hikes. That will
be followed by producer price data on Thursday. 
    A New York Fed survey showed Americans' overall views on
inflation were little changed in August, as they predicted
rising costs for homes and food, while expecting bleaker
personal financial health.
    "What we're seeing is a lot of positive sentiment that is
really tied to bullishness around the likely CPI and PPI numbers
being more in line with moderation," said Greg Bassuk, chief
executive officer of AXS Investments in New York.
    "As long as the inflation numbers for August come in within
the band of expectations, we're going to see the Fed move away
from additional rate hikes."
    Wall Street logged weekly losses on Friday after a recent
uptick in oil prices and stronger-than-expected economic data
fueled concerns of sticky inflation and interest rates staying
higher for longer.
    Traders see a 93% chance that the central bank will hold its
interest rates at current levels at its September meeting, while
chances of a pause in November stand at 57%, according to the
CME FedWatch Tool.
    Fed officials have entered a blackout period, during which
they usually do not make public comments, until the policy
decision outcome on Sept. 20. 
        The S&P 500 climbed 0.67% to end at 4,487.46 points.
  
        The Nasdaq gained 1.14% at 13,917.89 points, while Dow
Jones Industrial Average rose 0.25% to 34,663.72 points.
  
    Volume on U.S. exchanges was relatively light, with 9.3
billion shares traded, compared to an average of 10.0 billion
shares over the previous 20 sessions.
        Of the 11 S&P 500 sector indexes, nine rose, led by
consumer discretionary  .SPLRCD , up 2.77%, followed by a 1.17%
gain in communication services  .SPLRCL .
  
    Qualcomm  QCOM.O  advanced 3.9% after the chipmaker signed a
new deal with Apple  AAPL.O  to supply 5G chips to the iPhone
maker until at least 2026. 
    Hostess Brands  TWNK.O  surged 19.1% after J. M. Smucker
 SJM.N  said it would buy the Twinkies-maker in a $5.6 billion
deal.
        Advancing issues outnumbered falling ones within the S&P
500  .AD.SPX  by a 1.5-to-one ratio.
  
        The S&P 500 posted 14 new highs and 11 new lows; the
Nasdaq recorded 36 new highs and 199 new lows.
  

 (Reporting by Ankika Biswas, Shreyashi Sanyal and Shubham Batra
in Bengaluru, and by Noel Randewich in Oakland, Calif; Editing
by Arun Koyyur, Vinay Dwivedi and Richard Chang)
 ((noel.randewich@tr.com))