_Wall Street Rallies on TikTok Talks & AI Boom; S&P Sets Record)
If Monday had a theme on Wall Street, it would be tech-fueled fireworks.
U.S. stocks climbed higher, powered by two irresistible forces: renewed hope in U.S.-China trade relations and rising enthusiasm around artificial intelligence.
Market Highlights
The major indexes all closed in positive territory. The S&P 500 rose 0.5 percent to finish at 6615.28, setting a new record. The Nasdaq Composite gained 0.9 percent, also hitting an all-time high. Even the Dow Jones Industrial Average, which has lagged behind technology-heavy indexes, managed to edge up 0.1 percent.
TikTok Deal Buzz
Treasury Secretary Scott Bessent revealed “a framework” for a TikTok ownership agreement after holding talks in Madrid with China’s Vice Premier He Lifeng. President Trump is scheduled to speak with President Xi Jinping on Friday to discuss the plan further. The possibility of TikTok shifting to U.S.-controlled ownership gave investors a boost of confidence and helped fuel a surge in major technology companies.
The artificial intelligence boom continues to ripple across industries, from data centers to energy and infrastructure. Alphabet’s stock jumped 4.5 percent, pushing the company’s market capitalization above $3 trillion for the first time. Tesla shares rose 3.6 percent after Elon Musk disclosed a $1 billion stock purchase, allowing the company’s stock to turn positive for the year. Seagate Technology soared 7.7 percent, marking its largest one-day gain since April, thanks to growing demand for hard drives that power massive AI-driven data centers. Even companies with only a loose connection to AI benefitted from the excitement. Wedbush analyst Dan Ives captured the sentiment, noting that technology stocks are likely to lead markets higher through the end of the year.
Nvidia and Trade Tensions
Not every development was favorable for tech investors. China’s antitrust regulator said that Nvidia had violated competition law, sending the company’s stock fractionally lower. Over the weekend, Beijing also announced investigations into U.S. chip imports, a reminder that trade frictions between the two countries remain unresolved even as some areas show signs of progress.
Federal Reserve Watch
Beyond TikTok negotiations and the AI surge, investors kept their eyes on the Federal Reserve. A widely expected interest rate cut this week fueled optimism, and the yield on the 10-year Treasury note fell to 4.034 percent as markets bet on additional cuts in the months ahead. Strategists noted that investors remain in “don’t fight the Fed” mode, reflecting confidence in the central bank’s path. Meanwhile, political developments added another layer of intrigue as the Senate prepared to vote on Stephen Miran’s nomination to the Fed board.