AI Deals Propel S&P 500 and Nasdaq Amid Economic Uncertainty

The S&P 500 and Nasdaq saw gains on Monday, bolstered by significant AI deals involving megacap companies like Amazon and Nvidia. While hawkish comments from Federal Reserve officials tempered investor enthusiasm, optimism around AI technology has driven markets to historic highs. Private economic data and interest rate decisions remain in focus.

The S&P 500 and Nasdaq climbed on Monday, buoyed by major AI transactions that invigorated large-cap firms such as Amazon and Nvidia. Amazon soared to an unprecedented level after securing a multi-year $38 billion agreement with OpenAI for cloud services. This move grants the ChatGPT creator access to Nvidia's graphics processors.

Nvidia's stock surged 3.2% following statements from President Donald Trump indicating the company's most advanced chips are being designated for U.S. firms. Additionally, Microsoft acquired export licenses for chip usage in UAE data centers. Loop Capital increased Nvidia's stock price target by $100, fueling further gains.

AI-driven optimism has propelled markets to new peaks, with the S&P 500 and Nasdaq recording extended monthly winning streaks. Investors eye earnings reports from Advanced Micro Devices and Qualcomm this week, while private economic data and Federal Reserve policy remain closely scrutinized amid ongoing inflation concerns.

(With inputs from agencies.)