S&P 500 posts first close above 7,800 as tech shares rise
The S&P 500 finished at a record 7,818.93 after rising 0.58%, supported by gains in major technology stocks and lower Treasury yields. The Nasdaq also closed…
The S&P 500 posts first close above 7,800 after rising 0.58% to 7,818.93 on Tuesday, as technology shares gained and Treasury yields declined. The record finish puts the broad-market index at a new closing high, while traders now look to Federal Reserve minutes due Wednesday for clues on policymakers’ rate decision.
Chipmakers helped drive the advance. The Nasdaq Composite also closed at a record, gaining 0.45% to 27,599.79, while the Dow Jones Industrial Average rose 253.38 points, or 0.49%, to 51,521.28.
Technology led. Marvell Technology jumped 5.8%, Broadcom advanced 3.7%, and Advanced Micro Devices gained nearly 3%, according to CNBC’s market report. Investors grew more optimistic about the companies’ outlooks, the report said.
“Everyone's like markets are up. AI is the place to be,” Stephen Kolano, chief investment officer at Integrated Financial Partners, told CNBC.
The gains came as the benchmark 10-year Treasury note yield fell 3 basis points to 5.281%. The 30-year bond yield was last little changed at 5.655%. CNBC reported that both yields had scaled to levels not seen since 2002 on Monday.
Those moves matter to investors because the session’s advance coincided with lower yields and strength in technology stocks, while concerns about inflation and oil remained in the conversation. Kolano said investors were looking past those inflation concerns for now, particularly those linked to oil and diesel, and treating them as issues that could be resolved in the future.
Oil prices finished little changed. Brent crude rose 0.26% to settle at $100.58 per barrel, while West Texas Intermediate futures gained 0.01% to $89.44 a barrel.
“People are looking for where might there be some source of contagion that starts to spread, but right now, it's all staying well contained and just being dominated by the momentum, the earnings growth, the investment coming from artificial intelligence,” Kolano said.
He also described interest rates as “fundamentally kind of where they need to be.”
Investors’ next focus is the Federal Reserve’s minutes from its September meeting, due Wednesday. CNBC said the release could offer insight into policymakers’ move to raise rates. The market report did not provide further details about the minutes or the expected market reaction.
Other views in the report pointed to risks beneath the record-setting session. Ray Dalio, founder of Bridgewater Associates, told Bloomberg Tuesday that the Treasury market could face more disruption this year if demand from China and Japan pulls back.
“They are starting to get squeezed,” Dalio said. He also said Japan had lent a lot of money to change its economic policy and now wanted to take some of it back. On China, he said: “The Chinese don't want to continue to accumulate.”
Michael Burry, meanwhile, wrote on social media Tuesday that he believes markets have begun to grapple with the future of the artificial-intelligence trade. “The stock market is quite obviously in its first stage of grief, denial. Per 2000 and 2008, this stage lasts 6-9 months,” he wrote.
CNBC’s report said Burry is shorting a number of companies involved with AI. It also cited his criticism of Nvidia’s depreciation schedule and his concern that institutional lenders financing the technology industry could face problems tied to data-center loans and bonds.
The S&P 500 and Nasdaq ended at closing records despite those cautions. Traders will next assess the Federal Reserve minutes due Wednesday.
Source: cnbc.com
