- Meta Platforms meets after notification of cutbacks
- Apple slips as COVID-19 slows production of shrink iPhone in China
- Indices close: S&P 500 +0.96%, Nasdaq +0.85%, Dow +1.31%
Nov 7 (Reuters) – Wall Street ended sharply higher on Monday as investors focused on Tuesday’s midterm elections that will determine control of Congress, while shares in Meta Platforms jumped on a report of job cuts at the Facebook parent.
Republicans are favored to win a majority in the House of Representatives in the election, with the Senate considered a toss-up by partisan prognosticators. Republicans can use majorities in both chambers to thwart Democratic President Joe Biden’s agenda.
“The likelihood of the Republicans taking the House or Senate is quite high, thus guaranteeing some form of gridlock over the next couple of years. That would probably take tax increases off the table, and any kind of big spending that could potentially be perceived as inflationary.” the table,” said Ross Mayfield, an investment strategy analyst at Baird.
Meta Platforms Inc ( META.O ) jumped over 6% after a report that the company planned to start large-scale layoffs this week. The stock has fallen more than 70% so far this year.
Recently battered shares of Microsoft ( MSFT.O ) and Google parent Alphabet ( GOOGL.O ) each rose more than 2% and contributed strongly to the S&P 500’s gains for the session.
Focus this week will also be on US consumer price data for October, due on Thursday, for clues on how much the US central bank’s rapid rate hikes are helping to cool the economy.
Four Fed policymakers indicated on Friday that they would consider a smaller rate hike at their next board meeting, despite new data showing another month of robust job gains and little sign of progress in lowering inflation.
Traders are divided on whether the Fed will raise interest rates by 50 basis points or 75 basis points at the US central bank’s meeting in December.
“All things being equal, whether the terminal rate is at 4.5%, 5% or higher, monetary policy is poised to have a negative effect on the economy heading into 2023,” Glenmede’s investment strategists wrote in a note on Monday.
Unofficially, the S&P 500 climbed 0.96% to end the session at 3,806.90 points.
The Nasdaq rose 0.85% to 10,564.52 points, while the Dow Jones Industrial Average rose 1.31% to 32,827.00 points.
Of the 11 S&P 500 sector indexes, eight rose, led by communications services (.SPLRCL) which was up 1.83%, followed by a 1.73% gain in energy (.SPNY).
All three major U.S. indexes have fallen this year, with tech-heavy Nasdaq (.IXIC) down 33% on concerns that aggressive monetary tightening could cripple the U.S. economy.
Digital World Acquisition Corp ( DWAC.O ) surged 66% after former U.S. President Donald Trump hinted at a new bid from the White House. The blank check firm has agreed to go public with social media startup Trump Media & Technology Group Corp.
Walgreens Boots Alliance Inc ( WBA.O ) gained 4.1% after VillageMD, a primary care provider backed by the pharmacy chain, said it will buy Summit Health in a deal worth nearly $9 billion.
Advancing issues outnumbered decliners in the S&P 500 (.AD.SPX) by a ratio of 2.8 to one.
The S&P 500 posted 18 new highs and 15 new lows; The Nasdaq registered 93 new highs and 221 new lows.
Volume on US exchanges was relatively light, with 10.5 billion shares traded, compared with an average of 11.8 billion shares over the previous 20 sessions.
Reporting by Shubham Batra and Amruta Khandekar in Bengaluru, and by Noel Randewich in Oakland, California; Additional reporting by Shreyashi Sanyal and Devik Jain; Editing by Maju Samuel, Chizu Nomiyama and Deepa Babington
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