Stock Market Update

[BRIEFING.COM] The S&P 500 (+0.2%), Nasdaq Composite (+0.8%), and DJIA (+0.3%) notched fresh record highs today amid a mega-cap rally, with NVIDIA (NVDA 201.03, +9.54, +4.98%) leading the advance as the market was struck with a wave of developments that came out of the company's GPU Technology Conference. 

NVIDIA captured a record high of its own, rising past the $200 mark for the first time since its stock split. Importantly, CEO Jensen Huang said that the company has over $500 billion in orders through 2026 for its Blackwell and early Rubin chips. Mr. Huang also stated that the Blackwell chips are now being manufactured in Arizona. 

Today's surge in NVIDIA's strength brought a number of companies with it. 

Nokia (NOK 7.77, +1.41, +22.17%) traded sharply higher after NVIDIA announced it will take a $1 billion equity stake in the company. The two companies will also collaborate to launch AI-native 5G-Advanced and 6G networks on NVIDIA platforms. 

Super Micro Computer (SMCI 52.36, +0.79, +1.53%), CrowdStrike (CRWD 546.94, +17.24, +3.25%), and Palantir Technologies (PLTR 189.60, +0.42, +0.22%) were among the other names that traded higher after mentions at the conference.

Unsurprisingly, the information technology sector (+1.6%) led today's advance. Microsoft (MSFT 542.07, +10.55, +1.98%) also captured a solid gain after announcing the plans for its continued partnership with OpenAI. 

NVIDIA's impressive strength was not ubiquitous across other chipmaker names, as the PHLX Semiconductor Index captured a rather modest 0.4% gain. 

Mega-cap strength was, however, more consistent today. The consumer discretionary sector (+0.3%) finished with a gain due to strength in Tesla (TSLA 460.55, +8.13, +1.80%) and Amazon (AMZN 229.25, +2.28, +1.00%). 

The Vanguard Mega-Cap Growth ETF gained 0.9% today, and the market-weighted S&P 500 (+0.2%) decidedly outpaced the S&P 500 Equal Weighted Index (-0.9%). 

Outside of the mega-cap realm, the materials sector (+0.1%) was the only other S&P 500 sector to finish higher. The sector was supported by strong performances from Sherwin-Williams (SHW 354.57, +18.49, +5.50%) and Nucor (NUE 152.04, +7.88, +5.47%) after beating earnings expectations. 

Eight S&P 500 sectors finished in negative territory, with the real estate sector (-2.2%) slipping the furthest, as shares of Alexandria RE (ARE 62.95, -14.92, -19.16%) fell after an earnings miss. 

The utilities (-1.7%), energy (-1.1%), and consumer staples (-1.0%) sectors also incurred fairly wide losses. 

Smaller-cap indices also faced pressure today, with the Russell 2000 (-0.6%) and S&P Mid Cap 400 (-0.9%) closing well beneath their baselines. 

Ultimately today's advance was underpinned by the strength of a few of the market's largest names, and in particular, its largest. While NVIDIA's rally boosted the major averages, the majority of stocks saw some profit-taking after yesterday's broad-based advance. However, the market displayed conviction in the AI trade today, which bodes well for a host of other mega-cap names set to start reporting earnings tomorrow after the close.

Additionally, tomorrow's FOMC decision is widely expected to bring forth another 25-basis point rate cut, which could help stimulate growth in pockets of the market that lagged today. 

U.S. Treasuries recorded slight gains on Tuesday after spending the session in a sideways range that narrowed as the day went on. The 2-year note yield settled down one basis point at 3.49%, and the 10-year note yield settled down one basis point to 3.98%.

• Nasdaq Composite: +23.4% YTD
• S&P 500: + 17.2% YTD
• Russell 2000: +12.4% YTD
• DJIA: +12.1% YTD
• S&P Mid Cap 400: +5.1% YTD

Reviewing today's data:

• The Conference Board's Consumer Confidence Index slipped to 94.6 in October (Briefing.com consensus 94.2) from an upwardly revised 95.6 (from 94.2) in September. In the same period a year ago, the index stood at 109.6.
  • The key takeaway from the report is that there wasn't much change in consumer confidence in October, as a small uptick in views about the present situation was offset by a small drop in views about the outlook.
• The FHFA Housing Price Index was up 0.4% month-over-month in August (Briefing.com consensus 0.1%) after a revised flat reading (from -0.1%) in July.
• The S&P Case-Shiller Home Price Index was up 1.6% year-over-year in August (Briefing.com consensus 1.9%), down from 1.8% in July.