The S&P 500 cut losses to close higher Tuesday, as investors weighed up the likely end to the long-running government shutdown, though gains were held back by slip in Nvidia and other AI-related stocks.
At 4:00 p.m. ET (20:00 GMT), the Dow Jones Industrial Average rose 559 points, or 1.2%, while S&P 500 index gained 0.2%, and the NASDAQ Composite fell 0.3%.
Nvidia falls after Softbank sells entire stake; CoreWeave hit by partner delay
Nvidia led the decline among AI-related stocks after Softbank unveiled Tuesday that is had sold its entire $5.83B stake in chipmaker as the company looks to focus investing in ChatGPT marker OpenAI.
On the earnings stage, CoreWeave (NASDAQ:CRWV), stock fell after the Nvidia-backed AI cloud services firm flagged a delay at a third-party data center partner.
The update overshadowed otherwise solid third-quarter results from the group, which has recently moved to fortify its position in the AI boom through a series of multibillion-dollar deals with major tech industry names like ChatGPT maker OpenAI and Facebook owner Meta Platforms (NASDAQ:META).
Elsewhere, Paramount Skydance (NASDAQ:PSKY) stock rose after the entertainment company said it is looking to cut an additional $1 billion in savings after first outlining $2 billion when it completed its merger in August.
Rocket Lab (NASDAQ:RKLB) stock jumped higher after the space company reported a smaller third-quarter loss than expected.
TheRealReal (NASDAQ:REAL)stock surged 15% after the online marketplace raised its full-year revenue guidance and reported third-quarter revenue that beat expectations.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. Government set to reopen The U.S. Senate voted to send a spending package which would end the longest-ever federal government shutdown to the House of Representatives, as eight Democrats provided the support needed to break the impasse.
Republicans, who control both the Senate and the House, are anticipated to continue backing the bill, and then it will be sen to the White House to be signed into law by President Donald Trump.
The bill could mark an end to the longest shutdown in U.S. history, which was seen causing widespread disruption in the country, and is also expected to have weighed on gross domestic product in the fourth quarter.
"The shutdown resolution (even though the government won’t actually reopen for several more days) is clearly a positive, and many feel it gives a bright green light for the much-anticipated year-end rally to finally commence," said analysts at Vital Knowledge, in a note.
Expectations of an end to the shutdown helped the main averages on Wall Street ended higher in the prior session, boosted by sharp gains in big artificial intelligence names, chiefly Nvidia (NASDAQ:NVDA) and Palantir (NASDAQ:PLTR).
UBS sees earnings driving S&P 500 higher There are still some corporate results earnings emerging this week, although the bulk of what has been a generally positive third-quarter earnings season is now behind us.
In fact, UBS expects the S&P 500 index to climb to 7,500 next year, from the current 5,830 level, driven by “around 14% earnings growth,” nearly half of which will come from technology stocks.
