US STOCKS-Wall St closes higher as investors return to megacap stocks

Phunware

22/07/2024 21:43

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      Nvidia jumps on report of new AI chip for China market
    

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      Mattel soars after Reuters reports buyer interest 
    

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      CrowdStrike slips after Friday's global cyber outage
    

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      Verizon falls on Q2 revenue miss
    

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      Indexes rise: Dow 0.32%, S&P 1.08%, Nasdaq 1.58%
    

  
 (Updates with closing prices)
    By David French
       July 22 (Reuters) - Wall Street's three benchmarks ended
higher on Monday as investors returned to megacap growth stocks,
helping both the S&P 500  .SPX  and Nasdaq Composite  .IXIC 
recover from their worst weekly performance since April.
    The Dow Jones Industrial Average  .DJI  was also back in
positive territory, breaking a two-session skid since hitting an
all-time closing high last Wednesday.
    Megacaps Alphabet  GOOGL.O , Meta Platforms  META.O  and
Tesla  TSLA.O  all advanced between 2.2% and 5.1% after being
major drags on the market last week.
    Nvidia  NVDA.O  also rose 4.8% after Reuters reported the
artificial intelligence chip leader was working on a version of
its new flagship AI chips for the China market that would be
compliant with current U.S. export controls.
    The Information Technology index  .SPLRCT  climbed 2%,
topping sectoral gainers and snapping a four-day losing streak.
    "We think this move today probably has more to do with a
rebound from the selling that occurred last week than anything
else," said Jason Pride, chief of investment strategy & research
at Glenmede.
    Chief among the other factors on traders' minds was a
reexamination of the state of the presidential race after U.S.
President Joe Biden announced his withdrawal and endorsed Vice
President Kamala Harris' candidacy for the November election on
Sunday.
    Biden's exit could prompt investors to unwind trades on bets
that a victory for Republican Trump would increase U.S. fiscal
and inflationary pressures. But some analysts said markets could
benefit from an increased chance of a divided government under
the next administration.
    
    
    Online betting site PredictIt showed pricing for a Donald
Trump victory slipped 4 cents to 60 cents, while climbing 12
cents for a Harris win to 39 cents.
    Trump-linked stocks were mixed on Monday, with Trump Media &
Technology Group  DJT.O  dropping 0.8%, while software firm
Phunware  PHUN.O  gained 4%.
    Having digested the news of Biden's withdrawal, investors
will now be looking for answers to key questions including who
will join Harris on the Democratic presidential ticket and to
what degree, if any, the vice president will deviate from the
platform which Biden was headlining.
        This element of uncertainty is present alongside
traders' angst over quarterly earnings, including from two of
the so-called Magnificent Seven companies - Alphabet and Tesla -
on deck this week.
    The results will test whether the recent rally in top-tier
high-momentum stocks is tenable and if a move to underperforming
sectors will continue.
    "We're seeing the market begin to price in a little bit a
faster set of rate cuts, and that is leading to a bit of a shift
in leadership to favor smaller-cap stocks and to deviate from
the focus on the largest tech companies," said Glenmede's Pride.
    "Obviously today looks a little bit different to that, but
it's still a trend in the background."
    The S&P 500  .SPX  gained 59.41 points, or 1.08%, at
5,564.41 points, while the Nasdaq Composite  .IXIC  climbed
280.63 points, or 1.58%, to 18,007.57. The Dow Jones Industrial
Average  .DJI  rose 127.91 points, or 0.32%, to 40,415.44.
    Cybersecurity firm CrowdStrike  CRWD.O  slumped 13.5%,
extending losses after a software update from the company
sparked Friday's global tech outage.
    Delta Air Lines  DAL.N  dropped 3.5% after canceling over
600 flights as it struggled to restore operations after the
outage.
    Verizon Communications  VZ.N  fell 6.1% after a
second-quarter revenue miss.
    Mattel Inc  MAT.O  jumped 15.1% after Reuters reported the
toy maker had been approached by buyout firm L Catterton with an
acquisition offer.
    Volume on U.S. exchanges was 10.95 billion shares, compared
with the 11.37 billion average for the full session over the
last 20 trading days.

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The Trump Trade    https://tmsnrt.rs/3YeC3tB
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 (Reporting by Shubham Batra, Ankika Biswas and Lisa Mattackal
in Bengaluru, and David French in New York; Editing by Sherry
Jacob-Phillips, Pooja Desai and Richard Chang)
 ((Shubham.Batra@thomsonreuters.com))