[New York Stock Market] MS and Nvidia Joined by Altman Hit All-Time Highs... Nasdaq Up 1.13%

The major indices of the U.S. New York stock market all closed higher on Monday, the 20th (local time), ahead of this week’s Thanksgiving holiday. Microsoft (MS), which announced the addition of former OpenAI CEO Sam Altman, and Nvidia, which is set to release earnings this week, both hit record highs, driving the overall market.

At the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 35,151.04, up 203.76 points (0.58%) from the previous session. The S&P 500, focused on large-cap stocks, rose 33.36 points (0.74%) to 4,547.38, while the tech-heavy Nasdaq index gained 159.05 points (1.13%) to close at 14,284.53.

All sectors in the S&P 500, except utilities and consumer staples, advanced. MS rose more than 2% following news that Sam Altman, previously ousted from OpenAI, would be joining the company. Nvidia, which is scheduled to report earnings this week, also rose over 2%. Both MS and Nvidia closed at all-time highs. Boeing jumped more than 4.6% after Deutsche Bank upgraded its investment rating from ‘Hold’ to ‘Buy.’ Intel rose 2.12%, and AMD increased by 0.75%.

[Image source=Reuters Yonhap News]

Investors focused on big tech news ahead of the Thanksgiving market closure on the 23rd and early close on the 24th. Before the market opened, MS, the largest shareholder of OpenAI, announced that former OpenAI CEO Sam Altman would join the company to lead a new advanced AI research team, helping the overall market start higher.

This week, the release of the Federal Reserve’s Federal Open Market Committee (FOMC) minutes and earnings from AI leader Nvidia are expected to act as market catalysts. Wall Street anticipates Nvidia’s Q3 earnings per share, to be released after market close on the 21st, to surge to $3.37 year-over-year. Nvidia’s stock price has already risen over 200% this year.

The FOMC minutes will also be released on the same day. The Fed previously held the benchmark interest rate steady at 5.25-5.5% during the October 31-November 1 meeting. With recent inflation indicators showing signs of slowing, the key focus will be on discussions regarding future monetary policy moves. On the 24th, the U.S. November Manufacturing PMI will be announced, and on the 26th, the Organization of the Petroleum Exporting Countries Plus (OPEC+) oil-producing nations meeting is scheduled.

Earlier, with inflation indicators showing clear easing, market expectations have grown that the Fed’s rate hikes have ended and that rate cuts may begin next year. According to the Chicago Mercantile Exchange (CME) FedWatch tool, as of this afternoon, federal funds futures market prices reflect a 99.8% probability that the Fed will hold rates steady at 5.25-5.5% at the December meeting. The likelihood of holding rates steady through January is 97.8%. The probability that the Fed will cut rates at least once (baby step basis) by May next year exceeds 60%.

U.S. Treasury Secretary Janet Yellen appeared on CNBC today and said, “I think we are making significant progress in lowering inflation.” However, she noted, “Americans are still experiencing higher inflation than before,” citing housing and grocery inflation as underlying factors.

The Conference Board’s October Leading Economic Index, released today, fell 0.8% month-over-month, raising recession concerns. This marks the 19th consecutive month of decline. The figure was worse than both the previous month and market expectations. Previously, the Leading Economic Index also declined for 19 consecutive months during the global financial crisis from late 2007 to 2009.

In the New York bond market, the benchmark 10-year U.S. Treasury yield fell to around 4.41%. The 2-year yield remained steady near 4.91%. The dollar index, which measures the value of the U.S. dollar against six major currencies, dropped 0.4% to 103.4.

Tom Heinlein, Chief Investment Strategist at Ascent Private Capital Management, said, “One of the factors triggering the rally from late October through today was the decline in Treasury yields.” However, he pointed out that fiscal spending and deficit issues pose risks that could pressure Treasury yields in the future. Richard Hunter, Head of Market Strategy at Interactive Investor, said, “Recent inflation data strongly supports the view that the rate hike cycle is over and has strengthened hopes that the Fed can guide the economy onto a soft landing.”

International oil prices rose more than 2% ahead of the oil-producing nations’ meeting amid expectations of additional production cuts. On the New York Mercantile Exchange, December delivery West Texas Intermediate (WTI) crude closed at $77.60 per barrel, up $1.71 (2.25%) from the previous session.