Stocks Soar to Record Highs as Nvidia Surges, Defying Consumer Confidence Dip
US Stocks Hit New Records Despite Early Consumer Confidence Dip
US stocks reached new highs on Tuesday, with major indexes recovering from an early-morning slump triggered by weak consumer confidence data. The market rally was primarily driven by gains in Nvidia and positive sentiment surrounding emerging markets.
The S&P 500 closed at 5,732.93, up 0.25%, while the Dow Jones Industrial Average rose 0.2% to 42,208.22. The tech-heavy Nasdaq composite saw the most significant gains, climbing 0.56% to 18,074.52.
Early trading saw indexes briefly dip into negative territory following the release of disappointing consumer confidence data. The Conference Board’s consumer confidence index for September came in at 98.7, well below the consensus estimate of 104 and marking the largest one-month drop in over three years.
Jamie Cox of Harris Financial Group commented on the implications, stating, “The consumer confidence drop raises concerns about future spending patterns and economic growth.”
The weak consumer sentiment data led to increased expectations for Federal Reserve rate cuts, with the odds of a half-point cut in November rising to 60.7%.
However, the market quickly rebounded, largely thanks to a nearly 5% rally in Nvidia’s stock. The chipmaker’s shares ended the day up by about 4%, helping to lift the broader tech sector. Nvidia CEO Jensen Huang’s completion of a predetermined stock sale plan did not dampen investor enthusiasm.
Emerging market stocks also played a significant role in Tuesday’s positive market sentiment, reaching their highest level in two years. This surge was primarily attributed to China’s announcement of its largest stimulus package aimed at reviving its economy.
In commodities, oil futures rose, with West Texas Intermediate crude oil up 1.71% to $71.56 a barrel and Brent crude up 1.72% to $75.17 a barrel. Gold increased by 1.29% to $2,687.8 an ounce.
The bond market remained relatively stable, with the 10-year Treasury yield holding steady at 3.734%. In the cryptocurrency space, Bitcoin gained 1.55%, reaching $64,305.
As markets continue to navigate economic uncertainties, analysts remain divided on the outlook. Citi predicts stocks could surge 10% by year-end if a recession is avoided, while others warn that steep rate cuts could potentially overheat the US economy.
