The Dow and S&P 500 each added more than a percent, while the tech-heavy Nasdaq rose about one and a half percent.
Ryan Belanger, founder and managing principal of Claro Advisors, said declining yields on the 10-year Treasury note were driving the gains in tech.
“I think tech stocks are now super expensive again and I think that’s a function of where the bond market is signaling interest rates will be later this year. So the bond market is on one end saying; ‘You’re not going to be raising as much as you think. In fact, you’re going to be cutting.’ And [Federal Reserve] Chair Powell is on the other end staring and saying; ‘No, I’m not.’ And we’re going to figure out who is going to blink first. But right now, the tech stocks are aligned with the bond market and lower rates later on this year. That’s a good thing for tech stocks and that’s what’s driving the gains this year for the Nasdaq.”
Megacaps Apple and Amazon.com kicked off the week with near 2% gains, helping to lift the Russell 1000 growth sector.
So too did shares of Microsoft, which rose 3.12% after Stifel lifted its price target on the stock, saying the tech-giant is clearly looking to upend Google Search dominance through its integration with ChatGPT.
Shares of Google-parent Alphabet ended essentially flat.
Shares of Meta Platforms rose 3% following reports the Facebook parent was planning fresh layoffs.
And shares of Fidelity National Information Services fell 12.5% following its decision to spin off its merchant payments business.
Investors now await the January CPI report on Tuesday to reassess their bets on the Fed’s monetary policy path and the direction of the stock market.
