Stock Market Today: Microsoft Gains Boost Stock Market

closeup of stock market chart with white bars and blue volume bars

(Image credit: Getty Images)

published 20 November 2023

Stocks closed higher Monday, building on their impressive November gains. There was little in the way of economic news to start the holiday-shortened week, but market participants had plenty of single-stock headlines to track – including a notable analyst note for Wall Street's newest semiconductor stock.

This morning, Wells Fargo analyst Gary Mobley initiated coverage on Arm Holdings (ARM) with an Overweight rating, which is the equivalent of a Buy. "We view ARM as one of the best positioned companies within the $550 billion global semiconductor industry," Mobley says. Among the things that Arm is "well-positioned to benefit" from are China's developing domestic chip industry and higher royalty rates the company can charge for newer-generation chips.

Mobley isn't alone in his bullish outlook for Arm stock, which held its highly anticipated initial public offering (IPO) back in September. According to S&P Global Market Intelligence, 19 analysts have a Buy or Strong Buy rating on the chipmaker, compared to eight holds, one Sell and one Strong Sell.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-200-80.png

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Arm shares surged 6.7% Monday, with fellow chipmakers Intel (INTC, +2.1%) and Broadcom (AVGO, +1.8%) also gaining ground. Nvidia (NVDA) was another industry winner, rising 2.3% ahead of its Tuesday night turn on the earnings calendar.

Microsoft pops after snagging ousted OpenAI CEO

In other equities news, mega-cap stock Microsoft (MSFT) jumped 2.1% after the company said it is bringing Sam Altman on board to head a new advanced artificial intelligence (AI) research team. In a startling move, Altman was fired as CEO of Microsoft-backed OpenAI on Friday and efforts over the weekend to reinstate him in the role failed. Altman, who is one of OpenAI's co-founders, chose instead to join the software giant.

"We remain committed to our partnership with OpenAI and have confidence in our product roadmap, our ability to continue to innovate," Microsoft CEO Satya Nadella said in a statement. The executive added that Microsoft looks forward "to moving quickly to provide" Altman and fellow OpenAI co-founder Greg Brockman "with the resources needed for their success."

Oppenheimer analyst Timothy Horan calls this a "win-win" for Microsoft, "as it still has full access to the best large language models (LLMs) and now the team to possibly make the next great LLM and the best AI minds in the world to help implement AI." Horan has an Outperform (Buy) rating on the Dow Jones stock.

As for the major indexes, the tech-heavy Nasdaq Composite rose 1.1% to 14,284, the broader S&P 500 gained 0.7% to 4,547, and the Dow Jones Industrial Average finished up 0.6% at 35,151.

As a reminder, the stock and bond markets will be closed Thursday for the Thanksgiving holiday and will close early on Black Friday.

TOPICS

With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.