Wall Street commenced the week on an optimistic note, propelled by increasing anticipation that the protracted 20-day federal government shutdown may soon reach its conclusion. National Economic Council Director Kevin Hassett expressed confidence on CNBC that the shutdown is “likely to end sometime this week,” warning that the Trump administration may institute punitive measures if Senate Democrats remain obstinate.
Traders are bolstered by hopes that the latest earnings reports will signal positive growth for corporations, despite broader economic uncertainties. Data from FactSet indicates that approximately 86% of the S&P 500 companies that have disclosed their earnings thus far have exceeded expectations.
In a robust trading session, the Dow Jones Industrial Average surged 516 points, or 1.12%. This rally was buoyed by a notable rise in Apple Inc. (AAPL) shares, which climbed 3.94%, marking the company’s first record high of the year. The stock’s upswing is attributed to strong sales figures for the recently launched iPhone 17 model in both the United States and China, with reports confirming that the iPhone Air sold out within minutes in China.
The S&P 500 followed suit, gaining 1.07%, while the tech-heavy Nasdaq Composite increased by 1.37%. Wall Street’s fear gauge, the VIX, experienced a significant decline of 12%.
The markets had earlier encountered turbulence this month when President Donald Trump threatened to impose significant tariff increases on China in response to its reduced exports of crucial rare earth minerals used in electronics manufacturing. This provocation led to a dramatic decline in the Dow, which fell nearly 900 points on October 10 amid fears of intensifying trade tensions between the world’s two largest economies. However, Trump has since retracted his stringent tariff threats, acknowledging that extensive tariffs on China are not a viable long-term strategy.
Looking ahead, investors are directing their attention toward the technology sector as they anticipate the earnings reports from major tech companies. Rick Gardner, Chief Investment Officer at RGA Investments, noted that “the stock market’s next big test may be big tech earnings towards the end of October and into November,” as analysts seek insight into how spending on artificial intelligence is translating into profitability.
The so-called Magnificent Seven stocks—Meta (META), Amazon (AMZN), Tesla (TSLA), Nvidia (NVDA), Microsoft (MSFT), Alphabet (GOOG), and Apple—have collectively accounted for 41% of the S&P 500’s gains this year, according to Howard Silverblatt, a senior index analyst at S&P Dow Jones Indices. Most of these companies are set to report their third-quarter earnings within the month.
In the commodities market, gold and silver futures witnessed significant gains, rising 4.3% and 3.3% respectively, as investors continue to seek safe-haven assets amid ongoing economic unpredictability.
