In a notable market update, US equity indexes have seen gains as consumer discretionary and technology sectors emerged as frontrunners. The S&P 500 registered a 1.2% increase, reaching 5,938.7 points, while the Nasdaq Composite surged 1.7% to 19,602.1. The Dow Jones Industrial Average experienced a rise of 0.8%, climbing to 42,713.9.
Across all sectors, utilities stood out as significant gainers during intraday trading. Mega-cap stocks led the charge, with Nvidia and Tesla recording impressive gains of 4.7% and 5.3%, respectively. Analysts from Wedbush Securities have indicated that Nvidia is expected to unveil new gaming products during the upcoming CES tech show, set to begin on January 7.
Their report highlights that Nvidia's most significant announcement is likely to focus on its 50-series graphics processing units, while investors will be keen to receive updates regarding the trajectory of its generative artificial intelligence sales. Meanwhile, Evercore ISI has adjusted its price target for Tesla from $195 to $275.
Following a recent report, Tesla saw a decline in global deliveries for the year 2024, marking its first annual drop. According to insights from Truist Securities, only roughly one-fifth of Tesla's price target is based on its traditional electric vehicle sales and associated energy capture and storage operations.
The majority of the valuation hinges on the company's ongoing projects linked to artificial intelligence. From an economic perspective, the Institute for Supply Management reported an uptick in the US manufacturing index, which rose to 49.3 in December from November's figure of 48.4. This result was notably higher than the anticipated 48.2 forecasted in a Bloomberg survey.
ISM Manufacturing Committee Chairman Timothy Fiore commented, "US manufacturing activity contracted again in December, but at a slower rate compared to November. Demand showed signs of improving, while output stabilized and inputs stayed accommodative." In a statement reflecting on the economic outlook, Richmond Federal Reserve President Tom Barkin conveyed optimism at the First Friday Economic Outlook Forum, asserting that he perceives the US economic landscape tilting positively for 2025.
Despite existing uncertainties surrounding the incoming administration's economic policies, Barkin believes there are prospects for more upside than downside concerning growth. Moreover, in corporate developments, President Joe Biden made the decision to block Japan's Nippon Steel's proposed acquisition of US Steel due to national security concerns and potential supply chain risks, resulting in a 5.8% decline in US Steel's stock during intraday trading. As for the US Treasury yields, they exhibited mixed performance during the session.
The yield on the 10-year note increased by 1.2 basis points, reaching 4.59%, following a brief period of lower trading that impacted most maturities earlier on. On the currency front, the US Dollar index decreased by 0.3%, settling at 109.03, retreating from a 52-week high reached just the previous day.
In commodity markets, West Texas Intermediate crude oil futures rose 1.3%, reaching $74.11 per barrel, while gold futures experienced a slight drop of 0.5% to $2,655.71 per ounce, contrasting with silver futures, which advanced by 0.5% to $30.06 per ounce..