Traders work on the floor of the New York Stock Exchange.
Brendan McDiarmid | Reuters
Stocks rose on Monday as the second half of 2024 began, with investors looking to build on the strength of the first half of the year.
The Dow Jones Industrial Average rose 214 points, or 0.6%, while the S&P 500 rose 0.3% and the Nasdaq Composite added 0.2%.
Technology stocks Apple and Alphabet rose modestly, while artificial intelligence favorite Nvidia fell more than 1%.
Continued excitement around artificial intelligence and stocks like Nvidia helped the S&P 500 rise 14.5% in the first half of the year, while the Nasdaq Composite rose 18.1%. The Dow Jones Industrial Average, which underperformed expectations after a second-quarter selloff, rose 3.8%.
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For the second quarter, the S&P and Nasdaq rose 3.9% and 8.3%, respectively, while the Dow fell 1.7%. The Nasdaq recorded three consecutive quarters of positive results for the first time since ending 2021 with five straight positive quarters.
“While the first six months of the year may have felt like a roller coaster for some investors, market performance justified continued investment and highlighted the benefits of diversification,” Mark Haefele, chief investment officer at UBS Global Wealth Management, wrote in a note on Monday.
Some are concerned that price-to-earnings ratios have reached high levels, but others expect this tech-driven momentum to continue at least through the summer.
“We’re not seeing a lot of evidence that tech is slowing down,” King Lip, chief strategist at Baker Avenue Wealth Management, said Friday on CNBC’s “Closing Bell.” “If anything, I’d say it’s accelerating.”
He expects the sector to face resistance during seasonal weakness and profit-taking in September and October, as well as around the election, but sees valuations as reasonable.
“The reality is that these companies have been so well-managed through thick and thin that they’ve been able to grow their revenues quite a bit during this period of economic growth,” he said. “These companies have delivered.”
A shortened trading week for holidays begins on Monday and markets are closed on Thursday for Independence Day. Investors will get a major clue about the state of the labor market when the June jobs report is released on Friday.
S&P PMI manufacturing data for June and ISM manufacturing data are due to be released on Monday, along with construction spending for May.
