Stocks moved higher on Monday, thanks to a rise in Apple shares, as investors looked ahead to a possible end to the ongoing U.S. government shutdown as well as a slew of big-name earnings reports and inflation data expected in the coming days.
The Dow Jones Industrial Average traded 547 points higher, or 1.2%. The S&P 500 also climbed 1.2%, while the Nasdaq Composite advanced 1.5%.
Apple led the market higher, rising 4% after receiving an upgrade to buy from hold at Loop Capital. The firm pointed to improving demand trends for the company’s iPhones, saying that "we are NOW at the front end of AAPL’s long-anticipated adoption cycle that suggests ongoing iPhone shipment expansion through CY2027."
Also giving a boost to stocks, the government shutdown, which has now entered Day 20, "is likely to end sometime this week," National Economic Council director Kevin Hassett told CNBC’s "Squawk Box" Monday. He added that he believes "moderate" Democrats would come together this week to strike a deal and that the White House was prepared to take stronger measures to force an end to the stoppage if there’s no deal this week.
Stocks are coming off a volatile trading week, ultimately closing higher despite flaring tensions between the U.S. and China, a sell-off sparked by regional bank loan losses and declines in a few high-flying artificial intelligence names. However, a strong start to the third-quarter earnings season appears to be lifting sentiment, alongside investors’ anticipation of another quarter percentage point rate cut at the Federal Reserve’s late October meeting.
Following the first week of the reporting season, 76% of the 58 S&P 500 companies that have posted results so far have exceeded earnings expectations, far surpassing the first-week average of 68% and slightly higher than last quarter’s 73% figure, according to Bank of America.
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