Stock Market Today: Nasdaq Soars on Strength in Magnificent 7 Stocks
The main indexes started the week strong after several mega-cap stocks rallied.
Stocks closed higher Monday, with the upside fueled by massive gains from several Magnificent 7 stocks. Wall Street is also looking forward to this week's Federal Reserve meeting, hopeful for clues on the central bank's rate-cut plans.
At the close, the Dow Jones Industrial Average was up 0.2% at 38,790, the S&P 500 was 0.6% higher at 5,149, and the Nasdaq Composite had gained 0.8% to 16,103.
A 4.6% rally in Alphabet's (GOOGL) share price helped spark the outsized returns for the S&P 500 and Nasdaq. The communication services stock jumped after a Bloomberg report indicated Apple (AAPL) is considering licensing Google's Gemini generative artificial intelligence (AI) models for the iPhone. Apple stock rose 0.6% on the news.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free 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.
CFRA Research analyst Angelo Zino kept his Buy ratings on both Alphabet and Apple following the news. The headlines likely confirm "that AAPL's internal [AI] efforts are well behind those of OpenAI and Gemini," Zino says, adding that they also show "the company is serious about adding significant AI capabilities" to its new iPhones.
Additionally, Zino believes that Alphabet's Google "is best positioned to win any external deal for AI on AAPL's devices given the strong search partnership the two already have."
Tesla soars after raising Model Y prices in Europe
It was a solid day for each of the Magnificent 7 stocks. While Alphabet's rally was indeed notable, Tesla (TSLA) was the best performer of the bunch. Specifically, TSLA stock rose 6.3% after the company said it raised the price of several of its Model Y electric vehicles in Europe.
Last week, Wells Fargo analyst Colin Langan downgraded the mega-cap stock to Sell from Hold, saying he expects recent price cuts to its electric vehicles to have "a diminishing impact on demand."
March Fed meeting starts tomorrow
Meanwhile, investors are keeping a close watch for any Fed-related headlines, with the central bank set to kick off its two-day policy meeting tomorrow.
No change to the federal funds rate is expected to be announced when the gathering concludes Wednesday afternoon, but the Fed's "dot plot," which summarizes what each member expects monetary policy to be going forward, could signal where the central bank expects it to be at the end of the year.
"Hotter-than-expected inflation data to start the year argue for a hawkish-leaning message from the Fed at the March FOMC meeting," says a team of economists at Deutsche Bank. "That said, in a very close call, we do not yet expect this to manifest in the Fed signaling less easing this year."
While the economists do anticipate a mild upward revision to the Fed's inflation forecasts for this year, "we expect the median dot to stay at three cuts for 2024."
According to CME Group's FedWatch Tool, futures traders are currently pricing a 34% chance the Fed will cut interest rates by a full percentage point this year, with the first quarter-point rate cut expected in June.
Related content
- Target Limits Self-Checkout To 10 Items
- Kiplinger's Economic Calendar for This Week
- Kiplinger's Earnings Calendar for This Week
-
S&P 500 Hits New High Before Big Tech Earnings, Fed: Stock Market TodayThe tech-heavy Nasdaq also shone in Tuesday's session, while UnitedHealth dragged on the blue-chip Dow Jones Industrial Average.
-
4% and Chill? Find Out If This Distribution Rule Fits Your RetirementTake this simple quiz to discover whether the 4% Rule will work for you in retirement.
-
Oregon Tax Kicker in 2026: What's Your Refund?State Tax The Oregon kicker for 2025 state income taxes is coming. Here's how to calculate your credit and the eligibility rules.
-
S&P 500 Hits New High Before Big Tech Earnings, Fed: Stock Market Today
The tech-heavy Nasdaq also shone in Tuesday's session, while UnitedHealth dragged on the blue-chip Dow Jones Industrial Average.
-
Yes, Artificial Intelligence Stocks Are BoomingIt's fair to ask about the latest tech boom, "Is it really different this time?"
-
I'm an Estate Planning Attorney: These Are the Estate Plan Details You Need to Discuss (And What to Keep Private)Gen Xers and Millennials would like to know if they're going to inherit (and how much), but Baby Boomers in general don't like to talk about money. What to do?
-
I'm a Financial Adviser: This Is How You Can Minimize the Damage of Bad Market Timing at RetirementPoor investment returns early in retirement on top of withdrawals can quickly drain your savings. The ideal plan helps prevent having to sell assets at a loss.
-
'You Owe Me a Refund': Readers Report Challenging Their Attorneys' BillsThe article about lawyers billing clients for hours of work that AI did in seconds generated quite a response. One law firm even called a staff meeting.
-
Dow Rises 313 Points to Begin a Big Week: Stock Market TodayThe S&P 500 is within 50 points of crossing 7,000 for the first time, and Papa Dow is lurking just below its own new all-time high.
-
January Fed Meeting: Live Updates and CommentaryThe January Fed meeting is a key economic event, with Wall Street waiting to see what Fed Chair Powell & Co. will do about interest rates.
-
7 Questions to Help Kick Off an Estate Planning Talk With Your ParentsIt can be hard for aging parents to discuss estate plans — and for adult kids to broach the topic. Here are seven questions to get the conversation started
