US stocks saw a significant upswing on Monday, rebounding from the steep losses incurred on Friday. The Dow Jones Industrial Average rose by 1.3%, nearly 600 points, while the S&P 500 and Nasdaq Composite experienced gains of 1.6% and 2.2%, respectively. The market’s recovery was primarily fueled by President Trump’s reassurances regarding the ongoing trade tensions with China, stating on social media that “it will all be fine!” This sentiment came after his previous remarks suggesting the imposition of a 100% tariff on Chinese imports, a move that had sparked fears of an all-out trade war and resulted in about $2 trillion in lost market value.
In a post on Truth Social, Trump attempted to calm market anxieties, describing Chinese President Xi as having had a “bad moment” and expressing a desire for mutual economic benefit. His comments not only soothed investors but also placed pressure on China to reconsider its recent trade restrictions. Meanwhile, China’s export growth outperformed expectations in September as the country strengthened trade ties with nations outside the US.
Optimism surrounding artificial intelligence (AI) also played a role in the market’s rebound, bolstered by OpenAI’s new partnership with Broadcom. This collaboration, which aims to produce custom AI chips, resulted in Broadcom’s stock climbing close to 10%. Additionally, Taiwan Semiconductor Manufacturing Company’s shares surged nearly 8% after analysts projected a 28% increase in profits for the upcoming third quarter.
However, Wall Street remains wary as the government shutdown enters its second week, delaying the release of key economic data including consumer inflation reports, which have now been postponed to October 24. This uncertainty has heightened anticipation for a speech from Federal Reserve Chair Jerome Powell, where he is expected to address economic conditions and monetary policy.
The start of the earnings season is also on the horizon, with major banks such as JPMorgan Chase, Goldman Sachs, and Wells Fargo set to report their quarterly results on Tuesday. Analysts forecast that profits for the six biggest banks will increase by approximately 6% compared to the same period last year.
On the commodities front, silver futures skyrocketed over 7%, exceeding $50 per troy ounce and surpassing a 45-year record. The surge in silver prices, up more than 73% this year, has been attributed to increasing investor demand for precious metals amid rising global tensions. Cobalt prices also saw a significant uptick, reaching a two-year high after the Democratic Republic of Congo announced stricter export quotas, which could lead to a supply deficit and push prices even higher in the coming years.
Meanwhile, shares of the dating app Grindr jumped over 11% after news emerged about potential buyout talks valuing the company at $3 billion. These discussions are primarily between key shareholders and Fortress Investment Group, aiming to finance the acquisition.
Conversely, Beyond Meat faced a drastic decline, with stock prices plummeting over 47% after announcing a debt swap agreement that would dilute current shares significantly. In a dramatic financial maneuver, the company is converting $1.1 billion of 0% interest debt into $200 million of new higher-interest debt, issuing over 316 million new shares in the process.
In tech news, Intel’s stock was downgraded by Bank of America as analysts expressed concerns that its recent stock performance may have gone “too far, too fast.” This comes amid competition challenges and skepticism about its future strategies.
As stock markets opened, the tech-heavy Nasdaq led the way, driven by hopes of easing tensions between the US and China and a positive outlook on AI demand, setting the stage for a potentially transformative week in both the markets and industry sectors.
