Dow surges 461 points as investors rethink Trump trade

Dow surges
Dow surges

The Dow Jones Industrial Average surged on Thursday, closing 461.88 points higher, or 1.06%, at 43,870.35. Investors poured into cyclical stocks anticipated to benefit from an accelerating economy while moving away from technology shares.

The S&P 500 added 0.53% to close at 5,948.71, and the tech-heavy Nasdaq eked out a 0.03% gain to end at 18,972.42.

“This is the week where everyone is rethinking the Trump trade,” said Mark Malek, chief investment officer at Siebert. “People are taking it a little more seriously.

It’s not enough to just say ‘we think the sector is going to do well’ — you have to have some answers.”

Among the leading stocks on Thursday, bank stocks showed significant gains, with industrial giants and retailers viewed as barometers for small companies seeing a more than 1% boost.

The stellar performance of artificial intelligence chip juggernaut Nvidia continued, with the company’s shares climbing 0.5% following strong third-quarter results and optimistic future guidance. Despite Nvidia’s impressive performance, some traders expressed concerns about the sustainability of its rapid growth. “While Nvidia’s story of huge beats has underscored the dramatic rise in AI growth, investors would be prudent to consider whether Nvidia outpacing estimates to such a degree is sustainable,” warned AXS Investments CEO Greg Bassuk.

Other technology stocks experienced turbulence. Alphabet’s shares slumped 2.2%, and Baidu’s shares declined nearly 5% amid ongoing antitrust concerns. Salesforce emerged as a bright spot, its shares soaring more than 5%, significantly contributing to the Dow’s gains.

Major contributors also included other tech giants, such as Amazon and Microsoft, which rose 3.1% and 1.2%, respectively. Bitcoin reached a new milestone, striking an intraday all-time high. Investors maintained hope that a prospective second Trump presidency would usher in supportive regulation for the cryptocurrency industry.

In midday trading, Nvidia’s stock fell about 1% despite strong quarterly earnings.

Dow leaps as investors adjust strategy

The chipmaker posted adjusted earnings of 81 cents per share on revenue of $35.08 billion, surpassing analysts’ expectations.

U.S. shares of Baidu fell about 5%, despite the company reporting a 12% increase in non-online marketing revenue, driven primarily by its artificial intelligence cloud business. Meanwhile, Alphabet shares tumbled after news broke that the Department of Justice is requiring Google to divest its Chrome browser following a ruling that established Google’s monopoly in the search market. Chicago Federal Reserve President Austan Goolsbee shared his perspective on future interest rate trends, suggesting that rates may need to be lowered soon.

He emphasized the recent stability in inflation and labor markets. “My view is that the long arc over the last year and a half shows inflation is way down and on its way to 2 percent. Labor markets have cooled to something close to stable full employment,” Goolsbee remarked.

Goolsbee alluded to the possibility of a gradual reduction in rates while noting potential caution against rapid rate cuts in the face of economic uncertainties. He is set to vote on the rate-setting Federal Open Market Committee in 2025. The AI and deep learning ETF experienced a standout session, climbing 3%, marking its best performance since August.

Among the key movers in the ETF were Snowflake and Palantir, which saw gains of 28.8% and 13.1%, respectively. Antitrust concerns continued to weigh on Alphabet’s shares, which fell for a second consecutive day, shedding more than 6%. The Justice Department has called for Google to divest its Chrome browser to remedy its monopolistic hold on the search market.

Overall, stocks finished higher on Thursday. The Dow gained 461.88 points, or 1.1%, to close at 43,870.35. The S&P 500 added 0.5% to end at 5,948.71, and the Nasdaq saw a marginal 0.03% rise, closing at 18,972.42.

Investors are closely watching economic trends and regulatory shifts as they navigate the dynamic market environment.

Harper Johnson

Harper Johnson stands at the forefront of digital marketing, where she dissects and interprets the impact of online advertising trends, social media dynamics, and search engine algorithms on consumer behavior.

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