US STOCKS-Wall St gains as investors reassess presidential race after Biden exit

Phunware

22/07/2024 19:26

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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 up: Dow 0.25%, S&P 1.03%, Nasdaq 1.53%
    

  
 (Updated to 1:57 p.m. ET/1757 GMT)
    By Ankika Biswas and David French
       July 22 (Reuters) - 
    Wall Street's three benchmarks advanced on Monday, as
investors reexamined the state of the presidential race after
U.S. President Joe Biden said he would not pursue a second term.
    The upward swing helped both the S&P 500  .SPX  and Nasdaq
Composite  .IXIC  recover some of the losses suffered the
previous week, when selling of megacap growth stocks and the
global tech outage had contributed to their worst weekly
performance since April.
        The Dow Jones Industrial Average  .DJI  was also back in
positive territory, set to break a two-session skid since
hitting an all-time closing high last Wednesday.
  
    Biden announced his withdrawal and endorsed Vice President
Kamala Harris' candidature for the November election on Sunday.
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.
    Among those rising on Monday were the megacaps which had
weighed heavy during the previous week's declines. Alphabet
 GOOGL.O , Meta Platforms  META.O  and Tesla  TSLA.O  gained
between 2.4% and 5.2%.
    Nvidia  NVDA.O  also rose 4.3%, 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  topped sectoral
gainers and was on track to snap a four-day losing streak.
    As of 1:57 p.m. ET, the S&P 500  .SPX  rose 56.49 points, or
1.03%, to 5,561.49 points, while the Nasdaq Composite  .IXIC 
gained 271.12 points, or 1.53%, at 17,998.06. The Dow Jones
Industrial Average  .DJI  rose 102.18 points, or 0.25%, to
40,389.71.
    Trump-linked stocks were mixed, with Trump Media &
Technology Group  DJT.O  dropping 1.4%, while software firm
Phunware  PHUN.O  gained 2.2%.
    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.
    
    
    "Trump still has the lead, but everybody is also waiting to
see who Harris will select for her running mate, which adds
uncertainty, but also a little bit of excitement to the
campaign," said Sam Stovall, chief investment strategist, CFRA
Research.
    The question of who will be on the Democratic presidential
ticket compounds investor unease ahead of quarterly earnings,
including from two of the so-called Magnificent Seven companies
- Alphabet and Tesla  TSLA.O .
    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. The small-cap Russell 2000  .RUT  gained
0.9%.
    "There is an awful lot of underperformance in the small-cap
stocks that investors can take advantage of. ... They are very
inexpensive by historic measures," Stovall said.
    Crucial economic data including the Personal Consumption
Expenditures Price Index - the Federal Reserve's preferred
inflation gauge, which is expected to shed light on the monetary
policy outlook - is due through the week.
    Traders have broadly priced in a 25-basis-point rate cut by
September and two cuts by the year-end, according to LSEG and
CME's FedWatch data.
    Cybersecurity firm CrowdStrike  CRWD.O  slumped 12.8%, set
to extend losses after a software update from the company
sparked Friday's global tech outage. 
    Delta Air Lines  DAL.N  lost 2% after canceling over 600
flights as it struggled to restore operations after the outage.
    Verizon Communications  VZ.N  fell 6.2% after a
second-quarter revenue miss.
    Mattel Inc  MAT.O  jumped 16% after Reuters reported the toy
maker had been approached by buyout firm L Catterton with an
acquisition offer.

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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))