Nasdaq Ends Day 3% ahead; Bulls Control Stock Market
The Nasdaq rose 3% on Monday and set its best single-day record in months as peace prevailed in the Middle East.
Quick overview
- The major U.S. stock indices saw significant gains on Monday, with the Nasdaq Composite rising 3.07%, marking its largest increase in months.
- A peace deal between Iran and the United States has alleviated market fears, contributing to a record high close for the Dow and a 1.65% rise in the S&P 500.
- SpaceX's stock debuted strongly, climbing 20% on Monday, dispelling initial concerns about its long-term value.
- Chip stocks also performed well, with Nvidia and AMD gaining 3.45% and 7% respectively, as the market anticipates stability in interest rates following the Fed's upcoming policy meeting.
The major U.S. stock indies climbed much higher Monday, with the Nasdaq Composite ending the day up by 3.07% and marking its sharpest gain in months.
The Dow closed at a record high on Monday, gaining nearly 1%, while the S&P 500 moved up 1.65% and the Nasdaq ended close to 26,700 for the day with an increase of more than 3%. News of a peace deal between Iran and the United States spurred strong stock market movement and removed much of the fearfulness the market has experienced since the conflict began back in February.
The completed deal with Iran, announced Sunday, is set to reopen the Strait of Hormuz and end attacks in Iran and the surrounding areas. The agreement will be signed on Friday, and the market expects the peace to hold, especially since the agreement has been signed electronically already. With fighting stopped in the region, the U.S. stock markets can operate unimpeded by fears that there will be a recession and rapidly rising inflation.
SpaceX Leads Stock Market Gains
The most prominent stock this week is certainly SpaceX (SPCX), just listed on stock indices and already climbing incredibly fast. On Friday, the stock rose 19% and then another 20% on Monday. Fears that the stock would instantly deflate and prove to be a meme stock with little value are proving to be ungrounded. Investors are taking SPCX seriously, and our coverage of the company’s plans moving forward shows that there could be some serious longevity for SpaceX.
Other stocks within the space sector also rose this week, and EchoStar (SATS) climbed 3.32% and Rocket Lab (RKLB) jumped 6.70%. Interest in SpaceX’s market debut lifted stocks in the same sector for weeks, and its launch has only buoyed the market further.
Chips stocks continue to show strength and further their rally from last week as Nvidia (NVDA) gained 3.45% on Monday while Advanced Micro Devices (AMD) jumped 7%. These stocks slowed down in premarket trading Tuesday, settling into stabler territory as investors sold off their shares amid the rally. There were no massive drops among these leading tech stocks, indicating that short term sellers were taking advantage of the quickly rising futures, but long-term investors appeared to be comfortable holding steady.
On Wednesday, the Federal Reserve will hold their policy meeting, and the pressure is off of them to lower rates now just to keep inflation at bay. With the conflict in the Middle East settling down and stock markets rising rapidly, there may be little need for interest rates to drop at the moment. Analysts expect that the Fed will not change the rates for now despite Kevin Warsh taking over Jerome Powell’s spot as chairman.
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