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Updated Mon, Oct 14, 2024, 6:48 AM 2 min read
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US stocks traded mixed on Monday but held near record highs as investors prepared for the next batch of big bank earnings to test that rally and the chances of an economic "soft landing."
The S&P 500 (^GSPC) moved up roughly 0.3% to head for a fresh record after ending above 5,800 for the first time on Friday. The tech-heavy Nasdaq Composite (^IXIC) jumped 0.5% as Nvidia (NVDA) shares rose to new highs, up 2.2%. The Dow Jones Industrial Average (^DJI) slipped 0.2%.
Earnings are taking center stage as the first full week of third quarter results gets underway. How the season plays out is seen as key to the rally in stocks as the bull market turns 2 years old.
The Dow and S&P 500 closed a winning week at new records after JPMorgan Chase (JPM) and Wells Fargo (WFC) earnings largely passed Wall Street's test. Investor focus is staying on big banks with reports from Goldman Sachs (GS), Citi (C), and Bank of America (BAC) on Tuesday's docket, and Morgan Stanley (MS) due Wednesday.
At the same time, there's still uncertainty about whether the Federal Reserve will cut interest rates again. A benign jobs report and data showing "sticky" consumer and wholesale inflation are building a case for no rate cut in November, some analysts argue. Retail sales data later in the week will feed into the debate as to whether the economy has held up in the face of Fed policy — the preferred soft landing.
Read more: What the Fed rate cut means for bank accounts, CDs, loans, and credit cards
On the corporate front, Boeing (BA) shares slipped almost 3% amid questions about the crisis-hit plane maker's future. The company, which faces a record $5 billion in third quarter losses, has slashed 17,000 jobs as a month-long strike hits manufacturing.
Elsewhere, Chinese stocks initially seesawed as investors picked over Beijing's latest promise of stimulus, but managed to rise and resuscitate their recent historic rally.
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Nvidia climbs 2%, hovers near record
Nvidia stock jumped more than 2% at the open on Monday, surpassing its June record high close of $135.58.
The stock was a couple of dollars away from its all-time intraday high just past $140.76.
S&P 500 touches new record, Dow slips as focus shifts to earnings
The major averages opened mixed on Monday as investors turned their focus on more bank earnings and other quarterly results from major companies.
The S&P 500 (^GSPC) moved up roughly 0.3% to a new record. On Friday the broader index ended above 5,800 for the first time
The tech-heavy Nasdaq Composite (^IXIC) rose 0.5% on Monday while the Dow Jones Industrial Average (^DJI) slipped 0.2% from its Friday record close.
Earnings season continues in full swing this week, with Citi (C), United Airlines (UAL), AI chip equipment maker ASML (ASML), Netflix (NFLX), and American Express (AXP) expected to report.
Oil dropped more than 2% as OPEC cut its demand forecast for 2024 and 2025. Traders also reacted to a lack of details from China's Finance Minister over the weekend on any large new stimulus spending.
Nvidia stock eyes record high and top spot as most valuable company ahead of Apple
Nvidia stock rose 1% pre-market to $136.22, putting the company on track to surpass its previous record closing price of $135.58 in June.
The AI chipmaker has made substantial gains in October following a massive, $6.6 billion funding round for ChatGPT-maker OpenAI, much of which will be funneled back to Nvidia. AI leaders, including Nvidia CEO Jensen Huang, have cited furious demand for Nvidia's latest Blackwell chips. Nvidia shares are up 8% over the past week.
Nvidia's gains also puts the company on track to once again earn a spot as the No. 1 most valuable company in the world, in terms of market capitalization. Nvidia is the world's No. 2 most valuable company, behind Apple. The chipmaker's market cap stood at $3.3 trillion Monday, while Apple's was $3.46 trillion. Apple, Microsoft, and Nvidia have traded places as the top three companies over the past year.
Nvidia is set to report earnings on Nov. 19. Wall Street analysts expect the company to report revenues of $33 billion, up 82% from the prior year, according to Bloomberg consensus estimates. Some 90% of Wall Street analysts covering the stock tracked by Bloomberg recommend buying Nvidia shares.
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