[New York Stocks] Shares surge as midterm uncertainty fades... ‘SOXL’ plunges 8.8%

[Financial News]  

All three major New York stock indexes surged on the 4th (local time). The gains came after Democrats won a landslide in the U.S. midterm elections held the previous day, regaining control of both chambers of Congress, and President Donald Trump conceded the results, contrary to concerns in some quarters, removing uncertainty.
Markets welcomed the prospect of checks and balances taking effect as power in the White House and Congress was divided between the Republican Party and Democrats.
Also helping was a more than 8% plunge in international oil prices, amid expectations that the war in Iran would end early.
However, concerns are mounting that stocks tied to AI, including semiconductor shares, could struggle in the future as Democrats, who have signaled plans to regulate artificial intelligence (AI), take control of Congress.

Investors flocked to industrial stocks instead of tech shares, which could face regulations and various investigations in the future.
The Dow Jones Industrial Average (DJIA), made up of 30 large-cap blue-chip stocks, surged 1,569.40 points (3.03%) from the previous session to 53,356.12. So-called “industrial” companies performed well, with 3M Company jumping 9.55%, McDonald’s surging 6.53%, paint and coatings specialist Sherwin-Williams rising 6.64%, and The Home Depot, Inc. gaining 6.53%.
The S&P 500 and NASDAQ Composite, which have larger weightings in tech stocks, also rose sharply, but their gains were only half as large as the Dow’s.
The S&P 500 rose 119.70 points (1.58%) to 7,688.62, while the NASDAQ Composite gained 364.50 points (1.44%) to 25,736.51.
The NASDAQ-100 Index, comprising 100 large-cap tech stocks, gained less than 1% amid weakness in semiconductor shares. It closed up 256.90 points (0.91%) at 28,437.17.
The leveraged exchange-traded fund (ETF) ProShares UltraPro QQQ (TQQQ), which seeks three times the daily move of the NASDAQ-100 Index, rose $1.69 (2.79%) to close at $62.24.

Semiconductor stocks were mostly weak.
The weakness came as the election of Democratic gubernatorial candidates heightened concerns that construction of AI data centers could be disrupted.
Sector leader NVIDIA Corporation plunged $6.56 (3.17%) to $200.13, while Micron slid $59.87 (7.00%) to $795.23.
Intel fell $2.28 (3.77%) to $58.27, while SK Hynix’s American depositary receipts (ADRs) plunged $7.72 (5.12%) to close at $143.07.
Marvell plunged $12.17 (7.08%) to $159.80, while Broadcom fell $6.65 (2.00%) to $325.48.
The leveraged ETF Direxion Daily Semiconductor Bull 3X (SOXL), which tracks three times the daily share-price moves of 30 major semiconductor stocks, plunged $6.44 (8.81%) to $66.68.

Big Tech stocks were mixed.
Most Big Tech stocks performed well despite the prospect of AI regulations, but Tesla and SpaceX, linked to Elon Musk, who donated huge sums to the Republican Party and was among its most prominent supporters, plunged.
Alphabet Inc. rose $8.90 (3.18%) to $288.93, while Microsoft Corporation (MS) surged $34.81 (6.68%) to $555.80.
Apple Inc. surged $17.61 (5.31%) to $349.51, while Amazon gained $15.34 (6.12%) to $266.03.
Tesla, by contrast, fell $13.31 (3.34%) to $385.19, while SpaceX plunged $5.39 (3.81%) to $135.92.
Palantir closed down $3.70 (2.11%) at $171.70.

Trump Media, the parent company of President Trump’s social media platform Truth Social, plunged $1.46 (24.54%) to $4.49, hitting a record low.
Neocloud stocks, a key part of AI, also struggled.
CoreWeave plunged $5.32 (9.90%) to $48.42, while Australian company IREN sank $2.75 (11.24%) to $21.71.
Defense stocks also struggled.
Lockheed Martin plunged $43.96 (6.88%) to $595.04, while Northrop Grumman fell $24.65 (4.53%) to $525.35.
The defense ETF iShares U.S. Aerospace & Defense ETF (ITA) fell $3.33 (1.54%) to $212.84.
Oil majors also performed poorly.
ExxonMobil plunged $8.19 (4.62%) to $169.27, while Chevron fell $8.31 (3.69%) to close at $216.96.

[email protected] Song Kyung-jae Reporter