[New York Stock Exchange] Tech Stocks Surge on Oracle-Led Rally Amid Year-End 'Santa Rally' Expectations

Nasdaq Leads Tech Rally with Gains Over 1%

On the 19th (local time), traders are conducting transactions in the options market at the New York Stock Exchange (NYSE) located on Wall Street, New York. Photo by UPI Yonhap News Agency

Overnight, all three major New York stock indexes closed higher. As year-end "Santa Rally" expectations continued, technology stocks, including Nvidia, showed collective strength following news that Oracle would acquire TikTok.

On December 19 (U.S. Eastern Time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 48,134.89, up 0.38% from the previous session. On the same day, the S&P 500 Index, which focuses on large-cap stocks, rose 0.88% to 6,834.50, and the tech-heavy Nasdaq Index climbed 1.31% to close at 23,307.62.

On this day, foreign media reported that ByteDance, the Chinese parent company of social networking service TikTok, had signed an agreement to establish a U.S. joint venture (JV) with Oracle and others, improving investor sentiment. The new JV will include ByteDance, Oracle, private equity fund Silver Lake, and MGX, which was established by Abu Dhabi's sovereign wealth fund. The investor consortium, including Oracle, will hold a 50% stake, while ByteDance will hold a 19.9% stake.

Oracle surged 6.63% from the previous session, buoyed by analysis that it had secured a new growth engine. Oracle's stock had previously been on a downward trend amid market skepticism over its plans to build large-scale artificial intelligence (AI) data centers. Evercore ISI commented, "The TikTok acquisition is a great deal for Oracle, bringing in significant additional revenue."

Additionally, news that the Donald Trump administration had begun considering allowing Nvidia's AI semiconductor chip, the H200, to be exported to China also boosted the overall tech sector. The Philadelphia Semiconductor Index soared 2.98%.

Nvidia, the largest company by market capitalization, rose 3.93%, Broadcom climbed 3.18%, AMD jumped 6.15%, and Micron Technology surged 6.99%. There was a trend of bargain hunting in AI and semiconductor-related stocks, which had recently undergone a period of adjustment. However, Tesla and Meta showed slight declines.

Palantir, an AI data analytics company, rose 4.14% on news of signing a large-scale contract with the U.S. Navy. On December 9, Bloomberg and others reported that the U.S. Navy plans to adopt Palantir's technology to address submarine construction delays.

Tom Garretson, Senior Strategist at RBC Wealth Management, said, "Large-scale bond issuances by some hyperscalers and AI-related companies could burden the market next year," but added, "These companies have excellent credit ratings and ample ability to increase debt for financing."

Coupang, which has been embroiled in controversy over a personal data leak, jumped 2.25%, ending a nine-session losing streak. The U.S. government recently mentioned Coupang when accusing the Korean government of unfair treatment of U.S.-listed companies, which is seen as a factor in the stock's rebound.

Although it was "quadruple witching day," when stock index futures and options, as well as individual stock futures and options, all expire simultaneously, there was no notable volatility. The Chicago Board Options Exchange (CBOE) Volatility Index (VIX) fell 1.96 points (11.62%) to 14.91 compared to the previous session.

The likelihood of a U.S. policy rate cut in January next year is considered low. According to the CME FedWatch Tool, the federal funds futures market reflected a 77.9% probability that the benchmark rate will remain unchanged in January next year.