Stock market today: Wall Street inches higher at the start of a holiday-shortened week

By ALEX VEIGA
AP Business Writer

Stocks moved modestly higher Tuesday, extending Wall Street’s winning ways in recent weeks, as the market kicked off what’s expected to be a quiet, holiday-shortened week of trading.

The S&P 500 was up 0.5% in afternoon trading. The benchmark index is near its all-time high set nearly two years ago following its longest winning streak since 2017.

The Dow Jones Industrial Average was up 188 points, or 0.5%, at 37,574 as of 2:39 p.m. Eastern. The Nasdaq composite was 0.5% higher.

Technology and industrial stocks accounted for a big share of the gains. Chipmaker Nvidia rose 1.1%, while Intel marched 4.8% higher for the biggest gain among S&P 500 stocks. Deere & Co. rose 1.6% and Caterpillar added 2.2%.

Energy stocks climbed as the price of U.S. crude oil rose 2.6%. Hess rose 1.8%.

Solid gains by smaller company stocks also helped lift the market, pushing the Russell 2000 index 1.3% higher.

Treasury yields were mixed. The yield on the 10-year Treasury slipped to 3.88% from 3.90% late Friday.

Some stocks surged on company deal news. Drugmaker Bristol Myers Squibb said Tuesday that it will acquire RayzeBio in a $4.1 billion deal, just days after buying Karuna Therapeutics for $14 billion. Bristol Myers shares fell 1.8%, while RayzeBio doubled to $61.40, close to the $62.50 that each share will fetch in its acquisition.

Shares in HollySys Automation Technologies jumped 5.7% after the company received an updated buyout offer from a consortium led by Dazheng Group Acquisition.

Stratasys vaulted 12.7% to $14.78 per share after Nano Dimension announced it has offered to pay $16.50 per share in cash for the buy the maker of 3D printers. Stratasys rejected an earlier buyout bid from Nano Dimension in April.

Gracell Biotechnologies surged 60.4% after the Shanghai-based biopharmaceutical company agreed to be acquired by AztraZeneca.

Wall Street is coming off its eighth straight winning week. With less than a week to go in 2024, the S&P 500 is now up more than 24% for the year, while the Nasdaq is up more than 43%.

Investors have been encouraged by reports showing inflation is on the decline even as the economy appears stronger than expected.

The Federal Reserve is walking a tightrope, seeking to slow the economy enough through elevated interest rates to cool inflation, but not so much that it tips the nation into recession.

Traders are still largely betting the Federal Reserve will cut its main interest rate by at least 1.50 percentage points by the end of next year, according to data from CME Group. The federal funds rate is currently sitting within a range of 5.25% to 5.50% at its highest level in more than two decades.

The Federal Reserve released projections earlier this month showing its typical policymaker expects to cut the federal funds rate several times next year, but likely by only half as much as what Wall Street is expecting.

But many see too much optimism over the pace of interest rate cuts early in the year, and that the big run for stocks since late October on anticipation of such support may be overdone.

This week is light on economic reports. The Federal Reserve Bank of Richmond issues its monthly manufacturing activity index Wednesday. On Thursday, the Labor Department releases its weekly tally of unemployment benefit claims and the Commerce Department delivers its preliminary November snapshot of wholesale inventories.

European markets remained closed Tuesday.

Shanghai’s benchmark led losses in Asia on heavy selling of technology and computer chip-related shares as worries revived over trade tensions with the U.S. and other western countries.

A number of video gaming companies announced share buybacks to shore up prices after Chinese regulators issued draft guidelines on Friday that caused shares in game makers like Tencent and Netease to plunge. Hong Kong markets were closed Tuesday, so the impact of an effort by Beijing on Monday to cushion the impact of the new rules by voicing support for the industry and announcing the approval of more than 100 games was unclear.

The Shanghai Composite index sank 0.7%. In Shenzhen, where relatively more high-tech companies are listed, the A-share index lost 1.2%.