While the Dow notched its second closing record in a row with a small gain, the S&P 500 ultimately finished short of its closing record.
The S&P 500 technology sector finished up 1.6% to extend Friday’s gains after a steep selloff last week. The S&P 500 Software Services index ended up 2.9% as it clawed back some losses for a second day after a bruising seven days of losses fueled by fears that AI could intensify competition.
One big gainer in software was Oracle, which added 9.6% after D.A. Davidson upgraded it to a “buy” recommendation from “neutral.”
Along with the upgrade, Keith Lerner, chief investment officer at Truist Advisory Services, said another support for technology stocks came from comments CNBC attributed to Sam Altman, the CEO of Microsoft-backed OpenAI.
Altman told employees that the startup’s artificial intelligence chatbot, ChatGPT, was back to exceeding 10% monthly growth, according to CNBC’s report which Reuters could not independently verify.
“You’ve a sharply oversold market where a little bit of good news can go a long way,” said Lerner, adding that “the rubber band was stretched too far for tech and software” in last week’s selloff.While the software index was still almost 13% below its trading levels just before the exodus that started in late January, the broader tech sector was less than 3% under its pre-selloff levels.
After surpassing 50,000 points for the first time on Friday, the Dow Jones Industrial Average rose 20.20 points, or 0.04%, to 50,135.87. The S&P 500 gained 32.52 points, or 0.47%, to 6,964.82 and the Nasdaq Composite gained 207.46 points, or 0.90%, to 23,238.67.
The Nasdaq finished 3% below its latest record closing high, reached in November, while the S&P 500 was just out of reach of its last record close of 6978.60 reached on January 27.
The materials index, up 1.4%, showed the second biggest advance among the S&P 500’s 11 major industry indexes, as a rally in gold and silver boosted miners.
The consumer staples sector, which had benefited during the technology selloff, was tied with healthcare for the steepest sector declines of the day, with both falling 0.86%.
Healthcare’s biggest loser was Waters whose shares sank 13.9% after the lab equipment maker
forecast first-quarter profit below Wall Street estimates
. Investors also weighed weakness in a Becton Dickinson unit it acquired last year.
The Philadelphia SE Semiconductor index gained 1.4%. Among its members, Nvidia shares added 2.5% providing the S&P 500’s biggest boost, but traders must wait until later this month for results from the AI chip leader.
Coming closer in the pipeline is the January nonfarm payrolls report due on Wednesday, which was delayed by a partial government shutdown, and the closely watched January Consumer Price Index on Friday.
Markets are currently pricing in the year’s first interest-rate cut in June, according to CME Group’s FedWatch tool, which could be when U.S. President Donald Trump’s nominee for Fed chair, Kevin Warsh, takes over.
Among individual stock movers, Hims & Hers Health tumbled 16% for its seventh consecutive daily loss. Novo Nordisk sued the telehealth firm for patent infringement after the U.S. firm launched, then canceled, a $49 copy of the Danish drugmaker’s weight-loss pill Wegovy following backlash from the U.S. Food and Drug Administration.
Workday shares slid 5% after the human resources software provider announced co-founder Aneel Bhusri will return as its CEO.
Kyndryl shares plunged 54.9% after the IT services provider delayed its quarterly filing and flagged material weakness in its financial reporting.
Kroger’s shares rallied 3.9% after the grocery giant named former Walmart executive Greg Foran as its chief executive.
Advancing issues outnumbered decliners by a 2.13-to-1 ratio on the NYSE where there were 789 new highs and 99 new lows. On the Nasdaq, 2,887 stocks rose and 1,917 fell as advancing issues outnumbered decliners by a 1.51-to-1 ratio.
The S&P 500 posted 63 new 52-week highs and 20 new lows while the Nasdaq Composite recorded 165 new highs and 127 new lows.
Trading volume was relatively light on Monday with about 17.78 billion shares changing hands compared with the 20.66 billion moving average for the last 20 sessions.