Important points
Broadcom’s stock price rose on last week’s momentum after Wedbush analysts named it a top pick for semiconductors.
Supermicrocomputer stocks fell after being removed from the Nasdaq 100, and there were reports that the server maker may be planning to raise capital.
Major U.S. stock indexes had a mixed week of trading ahead of Wednesday’s key Federal Reserve interest rate decision.
Traders widely expect the central bank to announce further cuts to borrowing costs, but this week will see comments from Fed Chair Jerome Powell and more as investors try to gauge the economic trajectory and future policy moves. A number of economic indicators will be in the spotlight.
The S&P 500 index rose 0.4%, and strength in the communications and technology sectors led to a 1.2% gain and the Nasdaq’s all-time high at the close. The Dow Jones Industrial Average fell 0.3%.
Broadcom (AVGO) stock, which soared past the $1 trillion market cap milestone on Friday, picked up where it left off this week, surging 11.2% to a new record and leading the S&P 500’s rise. The company last week reported better-than-expected quarterly sales and profits, highlighting strong sales in artificial intelligence (AI). The momentum continued Monday, as analysts at Bernstein named Broadcom one of the top semiconductor prospects, along with industry giant Nvidia (NVDA).
Tesla (TSLA) stock rises 6.1%, the most in history, as Wedbush analysts discuss the automaker’s potential upside in AI and fully self-driving (FSD) technology under the incoming presidential administration. I got the highest price. Wedbush estimated that Tesla’s fully self-driving and AI opportunities alone are worth $1 trillion and expressed confidence that President Trump’s White House will streamline the approval process for these efforts.
Micron Technology (MU) shares rose 5.6% as the data storage chip maker prepared to report quarterly results Wednesday afternoon. Consensus forecasts are for strong year-over-year sales and profit growth. In early December, Micron received approximately $6 billion in subsidies under the federal CHIPS Act to produce semiconductors in the United States.
Super Micro Computer (SMCI) stock plunged 8.3%, making it the biggest decliner among the S&P 500 stocks. The decline followed the announcement late last week that Supermicro would be among three stocks removed from the Nasdaq 100 as part of the influential index’s annual reconstitution. Additionally, Bloomberg reported Friday that Supermicro has asked investment banking advisory firm Evercore (EVR) to assist with potential financing.
Stocks of companies operating pharmacy benefit management (PBM) businesses fell after President-elect Donald Trump suggested that cutting out so-called “middlemen” could be one way to reduce prescription drug costs. did. Lawmakers introduced a bipartisan bill last week that would require insurance companies and PBMs to separate from the pharmacy business. CVS Health (CVS) stock fell 5.6% on Monday, along with other major health insurance companies with PBM businesses.
Lower-than-expected consumer spending data in China and ahead of the U.S. Federal Reserve’s interest rate announcement this week pushed oil prices down from recent highs, weighing on oil and gas stocks. Shares of Phillips 66 (PSX) fell 5.2% after the company announced its 2025 capital plan and agreement to sell an interest in a natural gas pipeline in Texas. Marathon Petroleum (MPC) stock fell 5.1%.
