U.S. stocks surged to fresh records on Monday after the United States and China moved to ease trade tensions, setting the stage for President Donald Trump and President Xi Jinping to meet later this week.
The S&P 500 jumped 1.23% to close at 6,875.16, its first finish above the 6,800 mark. The Nasdaq Composite rallied 1.86% to 23,637.46, driven higher by semiconductor stocks, while the Dow Jones Industrial Average gained 337 points, or 0.71%, to 47,544.59. The Russell 2000 small-cap index also closed at an all-time high.
Chipmakers and tech stocks lift markets
Chipmakers were among the day’s biggest gainers. Nvidia and Broadcom both rose more than 2%, while Qualcomm soared 11% to a record high after unveiling new artificial intelligence chips, entering direct competition with Nvidia and AMD. Tesla shares climbed 4.3%.
Earnings season in focus
Investor attention now turns to a packed week of corporate earnings. Nearly 180 S&P 500 companies, including 11 Dow constituents, are reporting. Big Tech will dominate, with Microsoft, Alphabet and Meta set to release results mid-week, followed by Apple and Amazon. Collectively, these companies represent nearly a quarter of the S&P 500’s market value.
FactSet reports that so far, blended net profit margins for the index are tracking at 12.8%, above last year’s level and the five-year average. But analysts warn that high expectations leave little margin for error, particularly around AI monetisation and spending.
Interest rate outlook
The Federal Reserve is widely expected to cut its benchmark rate by a quarter point on Wednesday, after softer-than-expected inflation data last week.
Local market
Australian shares are set to open lower, with SPI futures pointing down 39 points, or 0.4%, to 9,041. Quarterly results are due from Liontown Resources and Nickel Industries, while annual meetings are scheduled for Austal, Credit Corp Group and CSL.
