The Nasdaq and S&P 500 indices recorded new records at the close on Monday, the market starting December with a little of the momentum that carried it into November, driven this time by the technology sector.
The Nasdaq and the S&P 500 increased by 0.97% and 0.24% respectively, while the Dow Jones lost 0.29%.
It was the 54th record of the year for the broader S&P 500 index, which gained almost 27% in 2024.
“From a technical point of view, the market is still in good shape,” commented Jack Ablin, of Cresset Capital, “especially since December is generally a favorable period.”
“If this sequence continues, this could be one of the most important upward movements in history,” considers José Torres of Interactive Brokers.
For this first session of the month, the New York market was driven by giant technological capitalizations, less visible in recent months.
Meta was particularly popular, as were the big names in semiconductors such as Broadcom (+2.73%), AMD (+3.56%) and Qualcomm (+2.84%).
“This could be linked to the fact that investors expect that rates will not fall as quickly as expected,” said Jack Ablin.
Several members of the American central bank (Fed) have made firm statements in recent weeks, suggesting that the health of the American economy allows them to be patient.
This feeling was reinforced on Monday by the publication of the ISM index, according to which activity in the manufacturing sector recovered in November, reaching its highest level since June.
Mark Streiber of FHN Financial noted that employment and new orders had driven the index.
Operators are now counting on three additional cuts in the Fed’s key rate by the end of 2025, compared to six two months ago.
Tech behemoths “have little or no debt,” emphasizes Jack Ablin, “so if investors think rates will remain high, they are interested in companies that are not going to borrow a lot.”
On Monday, the yield on 2-year US government bonds rose to 4.18%, compared to 4.15% at the close on Friday.
For Jack Ablin, the appearance of Monday’s session reflects a grouping around American technological flagships, considered the safest bet before seeing things more clearly.
On the side, Intel initially jumped after the surprise announcement of the departure of general manager Pat Gelsinger, with immediate effect, before finishing in the red (-0.50%). This engineer took control of the company in 2021 and carried out an in-depth restructuring.
He had notably bet on the development of the production capacities of Intel, which manufactures many of its own chips unlike most of its competitors.
But this strategic shift has weighed on the profitability of the Santa Clara (California) group, which is still struggling to reposition itself in the face of fierce competition in the semiconductor market, particularly in artificial intelligence (AI).
Elsewhere, General Motors fell (-0.99%) after the announcement of the sale of its stake in a Michigan battery factory to its South Korean partner LG Energy Solution, which will begin looking for a new manufacturer to sell the production of this site which is not yet operational.
The news had no effect on Tesla (+3.46%), supported by the appetite for giant capitalizations, but hit electric vehicle manufacturers Rivian (-2.94%) and Lucid (- 2.29%).
Nasdaq
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