The Nasdaq Composite gained 2.7% on Monday as oil prices fell and several chip and megacap tech stocks rose. Nvidia moved the other way after its board opened an investigation into CEO Jensen Huang. Investors now turn to AI earnings and inflation data.
The Nasdaq Composite gained 2.7% on Monday, as a decline in oil prices lifted stocks and traders kept watching technology shares after last week's volatility. The S&P 500 rose 2.1%, and the Dow Jones Industrial Average popped 900 points, or 1.8%.
Oil helped the move. West Texas Intermediate futures dropped 3% to around $87 per barrel, while Brent slid 4% to about $94.
Chip and megacap names climb as Nvidia falls
Broadcom and Advanced Micro Devices each popped 5%, and On Semiconductor rose 3%. Among the "Magnificent Seven" names, Amazon gained 5%, Tesla and Alphabet climbed more than 3%, and Microsoft added 2%.
Nvidia was the exception. Its shares were last down 6% after the company's board opened an investigation into co-founder and CEO Jensen Huang's relationship with a businesswoman whom U.S. intelligence agencies say is a Chinese spy. In a Sunday note, Dan Ives of Yorkville Ives & Co. wrote: "This is a black eye moment for Jensen".
Schwab's Sonders sees the Nasdaq oversold, but retail stays out
Liz Ann Sonders of the Schwab Center for Financial Research noted that the Nasdaq and Nasdaq-100 are oversold, with heavy de-risking by traders. Thursday was the biggest day of retail selling since the Covid pandemic, according to Vanda Research, and Sonders said retail traders haven't been taking advantage of the selloff.
Citi, however, tactically downgraded US tech to Neutral from Overweight in a Monday note, citing positioning and sentiment concerns.
AI earnings and inflation data come next
This week, investors look ahead to AI-related earnings from CoreWeave, Cisco and Applied Materials. They will also watch for the consumer price index on Tuesday and the producer price index on Friday for clues on the Fed's next move.
Source: CNBC
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