NEW YORK: The benchmark S&P 500 rose and the Nasdaq reached all-time highs on Monday as most megacap and growth stocks advanced, though risk sentiment remained in check as Treasury yields held near multi-year highs.
Heavyweight tech stocks took the lead, with Nvidia rising 1.2 percent, hovering close to its record high hit in the previous session. Meta Platforms, Microsoft and Tesla were up between 1.6 percent and 2.4 percent.
Ten of the 11 S&P 500 sectors were trading higher, with communication services and energy leading gains. Real estate was the sole laggard.
“The AI and tech story continues to drive the bus … it is so strong that it can fight the headwind from higher interest rates,” said Dennis Dick, founder and market structure analyst at Triple D Trading.
Chip stocks were slightly weak with the Philadelphia chips index down 0.1 percent, while software-related companies were among the top gainers. The S&P 500 software & services index rose 1.2 percent.
PTC was the top gainer on the S&P 500, rising 34 percent after France’s Schneider Electric agreed to acquire the software firm in a USD22.6 billion all-cash deal.
At 11:48 a.m. ET, the Dow Jones Industrial Average fell 31.71 points, or 0.06 percent, to 51,145.25, the S&P 500 gained 38.67 points, or 0.50 percent, to 7,761.39 and the Nasdaq Composite gained 208.85 points, or 0.77 percent, to 27,399.71.
Optimism about robust corporate earnings has helped US stocks outperform global rivals in the last six months, despite the shaky geopolitical landscape and inflation worries.
Goldman Sachs analysts expect most companies will “once again surpass consensus earnings estimates this quarter,” noting 9 percent year-on-year earnings growth for the median S&P 500 stock.
However, risk sentiment remained subdued as government bond yields held near their highs. The benchmark 10-year US Treasury yields were last at 5.328 percent amid concerns over deteriorating government finances, heavy debt issuance and elevated energy costs.
Global bond markets were in focus on worries over France’s debt burden and political uncertainty ahead of next year’s presidential election.
Meanwhile, the Nasdaq hit another record high after last week’s jump on softer-than-expected jobs data that doused chances of an October interest rate hike. Fresh data on Monday showed US services sector activity slowed in September.
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