Summary:
U.S. stocks rose with S&P 500 and Nasdaq gaining two days in a row.
Nvidia closed at a record high, reflecting strong AI sector performance.
Foxconn reported record revenue, driven by AI and cloud products.
Volkswagen and Xpeng announced a partnership on EV charging networks.
10-year Treasury yield continues to rise, putting pressure on stock valuations.
What You Need to Know Today
Back to back gains for S&P and Nasdaq
U.S. stocks mostly rose on Monday, with the S&P 500 and Nasdaq Composite climbing two days in a row. Nvidia, a leader in the artificial intelligence sector, closed at a record high. The pan-European Stoxx 600 index advanced 0.95%, despite U.S. President-elect Donald Trump dismissing fears about tariffs.
Foxconn shows AI is still hot
Foxconn, also known as Hon Hai Precision Industry, reported a 15% year-over-year growth in its fourth-quarter revenue, marking the highest ever for that period. This surge suggests that artificial intelligence remains a hot investment, positively impacting stocks of Nvidia and other semiconductor firms.
Partnership on charging network for EVs
Shares of Volkswagen and Xpeng rose after they announced a partnership to open their respective super-fast charging networks to each other's customers, signaling a collaborative future in electric vehicle infrastructure.
Trudeau steps down
Canadian Prime Minister Justin Trudeau announced he would step down as leader of the ruling Liberal Party, but will remain in his prime minister role until a new leader is selected.
Quality stocks against rising rates
The 10-year Treasury yield continues to rise, pressuring stock valuations. Morgan Stanley's chief strategist advises investors to focus on quality stocks amid potential market tumult.
Market Performance and Outlook
Semiconductor stocks jumped, driven by positive news around the AI sector. Foxconn's record revenue and Microsoft's substantial investment in AI infrastructure suggest continued strong interest in this field. Nvidia shares surged 3.4%, closing at $149.43, while the VanEck Semiconductor ETF also rose over 3%. The Nasdaq Composite was the clear winner, climbing 1.24%, while the S&P 500 rose 0.55%. However, the Dow Jones Industrial Average dipped 0.06%. Despite the positive market sentiment, analysts caution that true growth in AI will depend on companies' ability to leverage it for revenue growth, rather than simply inflating stock prices.
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