US stocks surge as investors eye earnings, FOMC decision

Dow Jones Industrial Average led Wall Street higher on Monday, notching its longest winning streak in six years. Investors are broadening the market’s breadth, with people starting to take profits in tech and invest in other parts of the markets. The tech-heavy Nasdaq Composite Index has rallied 34.3% this year, outperforming its peers as rate-sensitive megacap growth companies rose on optimism about artificial intelligence and an end to the Fed’s tightening cycle.

The Nasdaq lagged other indexes as investors looked to non-tech stocks for bargains, lifting sectors from energy to banks. Chevron gained almost 2% as the oil giant posted upbeat preliminary quarterly earnings over the weekend.

As of Friday, Q2 earnings are expected to decline by 7.9%, Refinitiv data showed. The Fed is expected to raise interest rates by 25 basis points at its policy-making meeting on Wednesday.

Nine of the 11 major S&P 500 sectors rose, led by a gain in energy stocks. Mattel rose 1.8% as the “Barbie” movie set a record as the biggest domestic debut of 2023. AMC Entertainment jumped 32.9% after a judge blocked the theater chain’s stock conversion plan that risked diluting investors’ holdings in the company.

U.S.-listed shares of Chinese companies like Alibaba and JD.com rose 4.5% and 3.5% respectively as its top leaders announced economic policy adjustments to expand domestic demand.