News that a debt ceiling deal was reached over the weekend sent stocks higher at the start of the holiday-shortened week, though optimism faded as the session wore on.
But it wasn't only the debt ceiling in focus today. Nvidia (NVDA) continued its monumental rise – briefly passing a milestone that's rarely been met on Wall Street. Tesla (TSLA) made headlines, too, after CEO Elon Musk headed to China for the first time in years.
Over the Memorial Day holiday weekend, House Speaker Kevin McCarthy and the White House agreed to a deal that will suspend the debt ceiling through January 2025, while keeping non-defense spending unchanged next year and limiting increases to 1% in 2025. The agreement also incorporates work requirements for certain food stamp recipients.
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.
The bill now heads to Congress where lawmakers will debate, and hopefully pass, the bill ahead of the June 5 deadline when the U.S. is projected to run out of money to pay its bills.
"It won't take a lot to disrupt this debt deal, but optimism remains that Congress won't mess with putting the economy at risk of an unnecessary catastrophe," says Edward Moya, senior market strategist at currency data provider OANDA. "Right now, it feels like we have a one run lead and are at the seventh-inning stretch."
Anxiety over whether or not the deal will gain enough support in Congress ahead of the default deadline had the major market indexes giving back early gains. The Nasdaq Composite, which was up 1.3% at its intraday peak, ended the day with a more modest 0.3% increase at 13,017. Meanwhile, the S&P 500 finished flat at 4,205 and the Dow Jones Industrial Average was 0.2% lower at 33,042.
Nvidia briefly hits a $1 trillion market cap
As for single-stock news, Nvidia was a notable gainer, building on last week's AI-induced momentum. Specifically, the chipmaker climbed almost 25% last week after it said demand for artificial intelligence will result in record revenue this quarter.
Today's gains came after Nvidia unveiled its new supercomputer over the weekend. "We believe Nvidia's accelerated computing GPUs stand out to be the biggest beneficiary in an AI-driven world and is the only way for cloud customers and broader enterprise space to create successful large language models at this time," says CFRA Research analyst Angelo Zino (Buy).
This sent NVDA up 7% at one point today, which briefly brought its market capitalization north of $1 trillion for the first time ever. This impressive milestone has been hit by just a handful of U.S. companies, with Apple (AAPL), Alphabet (GOOGL), Amazon.com (AMZN) and Microsoft (MSFT) the only firms currently in the trillion-dollar club. NVDA narrowly missed closing above the key psychological level, ending today up 3.0% at $401.11, with a market value of $992 billion.
Tesla, meanwhile, rose 4.1% today as CEO Elon Musk headed to China for his first visit in roughly three years. "While the geopolitical tensions between the U.S. and China are increasing, Tesla finds itself in a tight wire act to balance its success and production within China which remains a vital market on both the supply and demand front," says Wedbush analyst Daniel Ives (Outperform, or the equivalent of a Buy). Playing nice with Beijing is key to ensuring there are "no disruptions to Tesla's expansion and tentacles within China for the coming years as this remains the #1 EV market in the world," the analyst adds.
Stocks picked by AI to outperform
Big swings like we saw today are not for faint-of-heart investors, but they can be exciting for stock pickers. Many tactical traders have been homing in on the year's best momentum stocks as one way to play what's hot right now, but another approach leverages artificial intelligence.
Danelfin is an analytics platform that uses AI to analyze hundreds of fundamental, technical and sentiment data points per day for 1,000 U.S.-listed shares and 600 European-listed firms. Danelfin's algorithms then generate stock picks that it views as highly likely to outperform the market over the next 30 to 90 sessions.
So, what does Danelfin say are the best stocks to buy now? Read on as we take a look at the platform's latest high-scoring stocks.
Related Content
-
Do You Really Need That Wine Cellar?Home Features Wine cellars are a popular feature in high-end houses. Will installing one in your home increase its value, or would you be better off with a cheaper solution?
-
Think a Repeal of the Estate Tax Wouldn't Affect You? WrongThe wording of any law that repeals or otherwise changes the federal estate tax could have an impact on all of us. Here's what you need to know, courtesy of an estate planning and tax attorney.
-
Stock Market Today: Investors Look on the Bright SideA generally good week closes on another positive note, as investors, traders and speculators look for fresh catalysts.
-
My Three-Day Rule for Investing: And If it Applies NowStock Market I've seen a lot in my career. Here's what I see now in the stock market.
-
Is It Time to Invest in Europe?Stock Market Europe is being shaken out of its lethargy, militarily and otherwise, by Donald Trump's changes in U.S. policy. Should investors start buying?
-
Stock Market Today: Nasdaq Outperforms as Big Tech RalliesThe Dow Jones Industrial Average closed lower for a second day as Amgen and Merck fell.
-
Stock Market Today: UnitedHealth Drags on Dow After CEO SplitsUNH created headwinds for the price-weighted Dow on news that its embattled CEO, Andrew Witty, is stepping down.
-
Stock Market Today: Dow Gains 1,160 Points on U.S.-China Trade DealThe two countries agreed to a 90-day truce that will give them time to work on more substantive trade negotiations.
-
Stock Market Today: Investors Weigh Weekend NegotiationsInvestors, traders and speculators will look to Switzerland for answers about the most compelling issue confronting global markets.
-
Stock Market Today: Stocks Rise on Trump Trade DealThe U.S. and the U.K. agreed to a trade agreement that includes lower automobile tariffs.
