On Monday, US technology stocks saw a robust rally as market participants digested the fallout from President Joe Biden’s decision to withdraw from the 2024 presidential race and anticipated the commencement of earnings announcements from major tech giants.
The S&P 500 (^GSPC) advanced by over 1%, marking a recovery from its recent weekly losses, while the Nasdaq Composite (^IXIC), heavily weighted with tech stocks, surged approximately 1.6%. The Dow Jones Industrial Average (^DJI) also saw a modest gain of 0.3%.
Leading the charge in the tech sector was Nvidia (NVDA), whose shares rebounded strongly following significant declines last week amid broader market rotations away from large-cap stocks.
Monday’s market movements followed a significant political shakeup in the US presidential race, with Democratic leaders coalescing around Vice President Kamala Harris as Biden’s successor. Notably, endorsements from influential figures like former House Speaker Nancy Pelosi bolstered Harris’s position as the presumptive Democratic nominee.
However, the political turbulence injected added volatility into an already tumultuous stock market environment, potentially diverting attention from the upcoming deluge of corporate earnings and key inflation data releases scheduled for this week.
This shift could prompt a recalibration of recent market bets, such as those tied to expectations surrounding a potential second term for President Trump, impacting assets like bitcoin, bank stocks, and US Treasury yields.
Meanwhile, a slew of high-profile companies within the S&P 500 are slated to report earnings this week, including tech titan Alphabet (GOOGL, GOOG), electric vehicle manufacturer Tesla (TSLA), and fast-food chain Chipotle (CMG). These earnings reports are anticipated to provide critical insights into both economic conditions and consumer sentiment ahead of key economic data releases later in the week.
Investors are closely monitoring developments as market dynamics continue to evolve amidst shifting political landscapes and crucial corporate earnings reports.
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