Wall Street stocks closed higher on Monday, extending Friday's rally as increased odds that the U.S. Federal Reserve will lower its Fed funds target rate in December helped investors look past concerns about inflated tech valuations.
Market Snapshot
The Dow Jones Industrial Average rose 202.86 points, or 0.44%, to 46,448.27, the S&P 500 gained 102.13 points, or 1.55%, to 6,705.12 and the Nasdaq Composite gained 598.92 points, or 2.69%, to 22,872.01.
Market Movers
Tesla rose 6.8%. CEO Elon Musk said Sunday in a post on X that the electric-vehicle maker already had designed several million artificial-intelligence chips for its cars and data centers. Tesla is close to finishing its AI5 chip, has started work on its AI6 chip, and aims to bring a new chip to volume production every 12 months, Musk claimed.
Alphabet gained 6.3%. The Google parent has been the clear AI winner among megacap tech stocks this year, with shares surging 68% thanks to four consecutive earnings beats and excitement about the launch of Google's latest large-language model, Gemini 3. Microsoft ticked 0.4% higher after falling earlier in the session. Alphabet on Friday passed Microsoft to become the third-largest U.S. company by total market capitalization, the first time it has been above the IT giant since August 2018.
Alphabet stock jumps another 2% in after-hours trading while Nvidia dropped 2% in extended trading. Meta Platforms is considering spending billions of dollars on Google TPUs, including for Meta data centers, according to The Information.
Shares of Broadcom advanced 11% to $377.96. The company has worked with Google to develop tensor processing units, or TPUs, for more than a decade. HSBC adjusted its price target on the shares to $535 from $400 Monday while maintaining a Buy rating.
Nvidia gained 2.1%. The AI chip maker sent a memo to analysts over the weekend pushing back on a dozen claims made by skeptical investors. " Nvidia's underlying business is economically sound, our reporting is complete and transparent, and we care about our reputation for integrity, " the company said in the document, which was viewed by Barron's.
Strategy was up 5%. The company releases a securities filing each Monday showing how many Bitcoin it purchased in the preceding seven days; however, there was no word about a recent purchase. If Strategy goes a week without buying, that could be a sign uncertainty is starting to set in following a brutal selloff. The last week Strategy didn't buy Bitcoin was the period from Sept. 29 to Oct. 5.
Other crypto-linked stocks were rising as Bitcoin clawed back some of its recent losses. Online trading platform Robinhood jumped 7.2%, while crypto exchange Coinbase was 6.5% higher.
U.S.-listed shares of Alibaba gained 5.2%. The Chinese e-commerce giant said its artificial-intelligence app, Qwen, recorded more than 10 million downloads in the first week after a relaunch. Separately, Alibaba is scheduled to report fiscal second-quarter earnings on Tuesday.
Biogen was up 0.9%. Fellow drugmaker Novo Nordisk said its semaglutide pill failed to slow disease progression in patients with Alzheimer's in two separate trials. Biogen's Leqembi is one of the leading Alzheimer's drugs in the U.S., developed in collaboration with Japanese pharmaceutical giant Eisai. U.S.-listed shares of Novo were down 5.5%.
Shares of Sandisk, which makes computer-storage devices, rallied over 13% on Monday and continued to rise more than 7% in the extended session. The company is moving to the S&P 500 SPX from the S&P Small Cap 600 SML, replacing advertising and marketing company Interpublic Group of Companies Inc. $(IPG)$.
Eli Lilly, another major player in the world of Alzheimer's treatments, rose 1%. Shares climbed 1.6% on Friday, helping the company notch a market capitalization above $1 trillion for the first time. The other U.S. companies with 13-digit valuations are eight tech giants and Warren Buffett's conglomerate Berkshire Hathaway.
Inspire Medical Systems soared 31% to $117.29. The medical device maker, which specializes in treatments for obstructive sleep apnea, was upgraded to Buy from Hold at Stifel. Analyst Jonathan Block raised his price target on the shares to $110 from $100.
Oscar Health surged 22% following a report that said the White House was weighing a two-year extension to Affordable Care Act insurance subsidies. Fellow insurer Centene was up 4.6%.
MP Materials rose 6.8% to $59.04. The Western Hemisphere's largest producer of rare-earth materials got an upgrade at BMO Capital Markets on Monday. Analyst Raj Ray raised his rating on the shares to Outperform from Market Perform while lowering his price target by $1 to $75.
Market News
Trump Signs "Genesis Mission" Order to Boost Innovation With AI
President Donald Trump signed an executive order Monday establishing the “Genesis Mission,” a federal effort to boost innovation using artificial intelligence — the latest step by the administration to promote AI technology and its adoption.
The effort aims to better coordinate research done by agencies across the government and more effectively integrate AI tools to achieve more scientific breakthroughs, according to Michael Kratsios, the director of the White House Office of Science and Technology Policy, who spoke to reporters on the order ahead of Trump’s signature.
The mission will harness the computing resources of the Department of Energy’s national labs to tap federal datasets and enable more experiments utilizing AI, Kratsios added, predicting the effort would help shorten the timelines for scientific discoveries.
"Big Short" Investor Burry Targets AI Boom With New Blog After Hedge Fund Closure
"The Big Short" investor Michael Burry, a vocal skeptic of the current AI boom, took aim at Nvidia as he launched a paid Substack newsletter focused on financial markets, days after shutting down his hedge fund.
He compares the recent AI boom to the 1990s dot-com era in another post titled "The Cardinal Sign of a Bubble: Supply-Side Gluttony." The investor said he would continue writing about his findings in upcoming posts.
