Stock market today: S&P 500 hits fresh record close on stronger economic growth
Investing.com - U.S. stock futures pointed higher on Monday as traders turned their focus to upcoming results from Nvidia (NASDAQ:NVDA). The artificial intelligence semiconductor titan’s numbers come after its share price temporarily plummeted in late January following the emergence of a low-cost AI model from Chinese start-up DeepSeek. Elsewhere, Germany’s conservative bloc secures the most amount of votes in a key election on Sunday, while e-commerce behemoth Alibaba (NYSE:BABA) Group (HK:9988) unveils a $52.4 billion AI and cloud computing investment plan.
1. Futures higher
U.S. stock futures edged higher on Monday, pointing to a slight rebound from declines last week, as investors looked ahead to the high-profile quarterly earnings report from Nvidia.
By 03:18 ET (08:18 GMT), the Dow futures contract had inched up by 164 points or 0.4%, S&P 500 futures had gained 19 points or 0.3%, Nasdaq 100 futures had risen by 50 points or 0.2%.
The main averages on Wall Street fell to end the prior week, weighed down by figures showing a decline in U.S. business activity to a 17-month low -- signaling that companies and consumers were becoming increasingly worried about Trump administration policy actions. Consumer sentiment also slipped to a 15-month low and inflation expectations surged, as households fretted over the impact of U.S. President Donald Trump’s tariff plans.
On the economic calendar, traders will be paying close attention to the U.S. personal consumption expenditures price index for January. The data, due out on Friday, is widely viewed as one of the inflation metrics most preferred by officials at the Federal Reserve.
2. Nvidia ahead this week
Nvidia is set to headline the earnings calendar this week, with the semiconductor group and figurehead of a surge in investment in artificial intelligence expected to release the results after the market close on Wednesday.
The world’s second-most valuable company, Nvidia has become a bellwether for a boom in enthusiasm around AI that has powered a multi-year climb in stock markets. Nvidia’s share price has been a particular beneficiary, soaring by more than 550% over the past two years.
Investors will likely be keen to see what the Nvidia executives will have to say about the emergence of a low-cost AI model from Chinese start-up DeepSeek that recently roiled global equity markets.
The model raised concerns around the sustainability of and returns from massive spending sprees on AI pursued by some of the technology industry’s biggest firms. DeepSeek sparked a 17% tumble in Nvidia’s stock price on January 27, shedding $593 billion in value in the process -- a one-day Wall Street record.
Elsewhere, Warren Buffett’s Berkshire Hathaway (NYSE:BRKa) reported a third-straight all-time peak in full-year profits and lifted its cash stake up to $334.2 billion. The 94-year-old Buffett also told shareholders that "it won’t be long" before Vice Chairman Greg Abel takes over at the helm of the investment conglomerate.
3. German election
Germany’s conservative Christian Democratic Union and its Bavarian sister party garnered the most backing in a crucial vote on Sunday, although it remained unclear how lawmakers would approach establishing a new coalition government.
The far-right Alternative for Germany (AfD) party won the second-largest amount of support from German voters, followed by current Chancellor Olaf Scholz’s centre-left Social Democrats. Germany’s mainstream parties have said they would not work with the AfD, who has notably received the backing of tech tycoon and close Trump associate Elon Musk.
Friedrich Merz, the likely next chancellor of Germany, will move to begin establishing a coalition government during a time when the country’s economy -- a crucial cog in Europe’s economic engine -- is sputtering and security concerns have been heightened after the Trump administration’s recent negotiations with Russia on a potential Ukraine peace deal.
While there are still several outcomes to the coalition discussions, analysts have previously suggested that a concentration of control of Germany’s national parliament could support economic growth because it would help clear the path for some fiscal easing initiatives.
"[I]t is still unclear at this point what coalition options will be viable," said Franziska Palmas, Senior Europe Economist at Capital Economics. However, Palmas noted that "[r]egardless of the exact composition of the coalition we would expect the next government to cut income and corporation tax, reduce social benefits and increase defense spending."
4. Alibaba’s AI investment plans
Alibaba Group announced plans on Monday to invest 380 billion yuan ($52.4 billion) over the next three years to boost its cloud computing and AI infrastructure, marking its largest technology investment to date.
The move underscores Alibaba’s ambition to lead in AI-driven growth and solidify its position as a global cloud provider, the company said.
Hong Kong-listed shares in the e-commerce giant touched their highest level since November 2021 in the wake of the news.
In its latest quarterly report released last week, Alibaba reported a 7.6% year-over-year increase in revenue for the December quarter, totaling 280.15 billion yuan, slightly surpassing analysts’ expectations. During the earnings call, CEO Eddie Wu called AI a “once-in-a-generation” opportunity.
5. Gold steady, oil inches lower
Gold prices were slightly higher in early European trading on Monday, remaining close to recent peaks that have stemmed in part from safe-haven demand.
The yellow metal clocked a series of record highs last week, benefiting from sustained haven buying following fresh tariff threats from Trump.
Worries over the direction of the U.S. economy, exacerbated by the weak purchasing managers’ index and consumer sentiment readings on Friday, also fueled gold demand.
Meanwhile, oil prices edged lower, extending losses posted in the prior week, on the possibility of a resumption of exports from oilfields in Kurdistan.