The U.S. stock market saw significant gains on Monday, as the S&P 500 rose by 1.5%, marking one of its strongest performances since the summer. The Dow Jones Industrial Average increased by 202 points, or 0.4%, while the Nasdaq composite surged by 2.7%. These advances come at the beginning of a holiday-shortened week due to Thanksgiving.
Investors are increasingly optimistic that the Federal Reserve will cut its main interest rate again at its December meeting, a move that could help stimulate economic growth and raise investment prices. According to CME Group data, traders now see nearly an 85% chance of a rate cut next month, up from 71% on Friday and less than even odds a week earlier.
Stocks linked to artificial intelligence contributed significantly to Monday’s rally. Alphabet led with a gain of 6.3% following positive reception for its new Gemini AI model, making it one of the biggest drivers for the S&P 500’s rise. Nvidia also added momentum with an increase of 2.1%.
Market volatility has been high in recent weeks due to uncertainty about future Federal Reserve actions and concerns about whether investments in AI are creating an asset bubble. This comes after April’s sharp sell-off when President Donald Trump introduced “Liberation Day” tariffs.
Despite these challenges, the S&P 500 remains close to its all-time high set last month, trailing by only 2.7%. “It’s reasonable to expect that stocks will experience periods of pressure from time to time, which, historically, is quite healthy for longer-term strength,” wrote Anthony Saglimbene, Ameriprise chief market strategist.
Looking ahead this week, investors await several key events that could impact markets further—most notably Tuesday’s release of wholesale inflation data for September from the U.S. government. Economists predict prices rose by 2.6% year-over-year in September—the same as August—but any higher reading might prompt caution at the Fed regarding further rate cuts.
Some Fed officials have already expressed reluctance toward lowering rates in December because inflation continues to exceed their target of 2%.
U.S.-listed shares of Novo Nordisk dropped by 5.6% after announcing disappointing results from a trial involving its Alzheimer’s drug.
Grindr shares fell sharply—down 12.1%—after revealing it ended acquisition talks with two major investors who together own over half of Grindr’s stock; questions about financing led Grindr’s board committee to halt negotiations.
By session close:
– The S&P 500 gained 102.13 points to reach 6,705.12.
– The Dow Jones Industrial Average rose by 202.86 points to finish at 46,448.27.
– The Nasdaq composite advanced by 598.92 points to end at 22,872.01.
Bitcoin remained volatile; after reaching nearly $125,000 last month it hovered around $89,000 on Monday following swings between $82,000 and $94,000 during the previous week.
Internationally, European and Asian markets showed mixed results on Monday.
Hong Kong’s Hang Seng index climbed by about two percent—one of the largest moves globally—helped in part by Alibaba rising almost five percent amid strong demand for its Qwen AI app ahead of Tuesday’s earnings report.
