Tech behemoths and steelmakers drove Monday's rise in U.S. stock indexes as investors processed new trade policy developments and anticipated Federal Reserve Chair Jerome Powell's congressional testimony later this week.
The Nasdaq Composite surged 1.12% to 19,742.49; the S&P 500 rose 0.70% to 6,068.08. Rising 0.34%, the Dow Jones Industrial Average came to 44,454.52. With nine of the 11 sectors of the S&P 500 advancing—led by energy (+2%) and information technology (+1.7%), gains were broad-based.
Steelmakers Charge Ahead on Tariff Announcement
Following former President Donald Trump's announcement of intentions to put extra tariffs—25% on steel and 10% on aluminum—on top of current taxes, producers of steel and aluminum banded together. Century Aluminum gained 11%; Steel Dynamics jumped 5%; Nucor surged 13%. U.S. Steel climbed 4.7% in response to rumors that Nippon Steel of Japan is thinking about changing terms for its intended purchase.
Tech Stocks Rebounds
Recovering from Friday's selloff brought on by Trump's previous tariff comments, Broadcom surged 4.5% and artificial intelligence chipmaker Nvidia climbed 3.6%. Amazon climbed 1.5%, helping the tech industry recover.
"Investors are returning to what's worked—tech and growth sectors—and strong earnings are reinforcing confidence," said Sam Stovall, chief investment strategist at CFRA Research. Fourth-quarter earnings growth is tracking at 14.8%, up from first expectations of about 10%. Over half of S&P 500 businesses are reporting.
After showing an unexpected increase in worldwide comparable sales during Q4, McDonald's increased about 5%. After exceeding predicted fiscal first-quarter earnings, Rockwell Automation shot 14%. This week, investors await earnings reports from Coca-Cola, DoorDash ( Tuesday), CVS Health, and Cisco ( Wednesday).
Federal Alert
Fed Chair Powell is the focal point; he will present his semiannual monetary policy testimony to Congress on Tuesday and Wednesday. Based on Friday's mixed employment report showing strong labor conditions, markets mostly expect the central bank to keep rates constant in March.
While overall U.S. equities showed a 1.9-to- 1 tilt toward gainers, market breadth advocates outpaced decliners on the S&P 500 by a 1.3-to- 1 ratio.