Tech leads stocks broadly higher; Boeing drops

U.S. flags fly outside the New York Stock Exchange.
(Don Emmert / AFP/Getty Images)

A broad rally led by technology companies drove U.S. stocks sharply higher Monday, giving the Standard & Poor’s 500 index its biggest one-day increase since late January.

The latest gains also snapped a five-day losing streak for the benchmark index, which was coming off its worst weekly stumble this year.

Nvidia was the S&P 500’s strongest performer after agreeing to buy chipmaker Mellanox. Apple benefited from an analyst upgrade.

A sharp decline in Boeing held the Dow Jones industrial average back from gaining as much as the other major U.S. indexes.


Investors drew encouragement from a report showing a slight increase in U.S. retail sales for January after a steep decline in December, and from new data showing a rebound in Chinese exports this month, said Tom Martin, senior portfolio manager with Globalt Investments.

“The data that’s coming in today is at the margin at least OK; there’s no negative news,” Martin said. “People want to be in the market. Rates are low. Stocks are OK.”

The S&P 500 climbed 40.23 points, or 1.5%, to 2,783.30. The Dow rose 200.64 points, or 0.8%, to 25,650.88; earlier in the day, it was down as much as 242 points as Boeing slumped.

The Nasdaq composite, which is heavily weighted with technology stocks, jumped 149.92 points, or 2%, to 7,558.06. The Russell 2000 index of smaller companies advanced 26.99 points, or 1.8%, to 1,548.88.


Monday’s gains helped the market reclaim the momentum it had in January and February, when it posted the best two-month start to a year since 1991. Even though last week was the market’s worst since December, the S&P 500 and Nasdaq are showing double-digit gains for the year so far, and the Dow is just shy of a 10% increase.

Investors are still waiting for more details on any potential trade deal between the United States and China. Costly tariffs have hurt both nations and investors hope a deal can be struck to at least take some pressure off the global economy, which has shown signs of cooling off.

“Last week was a little bit of a breather, and investors said, ‘Well, maybe we overreacted a little bit,’ ” said Karyn Cavanaugh, senior markets strategist at Voya Investment Management. “We have good economic data, earnings should be pretty solid, and [the Federal Reserve’s push to raise interest rates] is on hold. We potentially have progress going on with China. So overall, things are pretty good and stocks are the place to be.”

Technology-sector stocks drove Monday’s rally, with chipmakers leading the way.

Nvidia jumped 7% after the chipmaker said it will buy network transmission company Mellanox for $6.9 billion in cash. The companies are frequent collaborators and said that together they help to power more than 250 of the world’s 500 supercomputers, including Sierra and Summit, operated by the U.S. Department of Energy.

Apple climbed 3.5% after receiving an analyst upgrade.

Boeing slumped 5.3% following the second deadly crash involving the newest version of the aircraft maker’s popular 737. An Ethiopian Airlines jetliner went down Sunday, killing 157 people. In October, another 737 Max 8 crashed in Indonesia, killing 189 people. Authorities in Ethiopia, China and Indonesia have grounded all Boeing 737 Max 8 aircraft.

Boeing’s stock had been soaring. On Monday, shares slid more than 13% at one point. It was the only stock in the Dow to close with a loss. Despite Boeing’s decline, the industrial sector managed to post a gain.


Healthcare stocks also helped drive the market higher. Align Technology rose 5.4%.

Social media companies also notched gains. Facebook rose 1.5%. Twitter advanced 2.8%.

Germany’s Deutsche Bank rose 5% after reports that it agreed to hold merger talks with rival Commerzbank.

Benchmark U.S. crude climbed 1.3% to settle at $56.79 a barrel. Brent crude, the international standard, rose 1.3% to $66.58 a barrel.

Bond prices fell. The yield on the 10-year Treasury note rose to 2.64% from 2.62%.

The dollar strengthened to 111.21 Japanese yen from 111.07 yen. The euro fell to $1.1240 from $1.1242.

Gold fell 0.6% to $1,291.10 an ounce. Silver fell 0.5% to $15.27 an ounce. Copper rose 0.3% to $2.90 a pound.

In other energy futures trading, wholesale gasoline rose 1.3% to $1.83 a gallon. Heating oil fell 0.3% to $1.99 a gallon. Natural gas slid 3.2% to $2.77 per 1,000 cubic feet.


Get our weekly California Inc. newsletter