Nasdaq surges over 1% on renewed buying interest in AI shares, S&P 500 rises 0.7%

US benchmark indices staged a gap up opening on Monday, October 19, rebounding from their worst weekly decline since June powered by a renewed buying interest in artificial intelligence shares as investors turned their attention towards an array of earnings due later this week.

Tech heavy Nasdaq index advanced as much as 1.34%, S&P 500 index climbed 0.71% and Dow Jones Industrial Average gained 0.13%.

Netflix, Meta, Tesla, IBM, Procter & Gamble, Blackstone, Spotify, American Express, GE Aerospace, General Motors and Fifth Third Bancorp among others are expected to report their quarterly earnings this week.

Tech stocks faced selling pressure last week, with chip stocks plunging as much as 20% for the week as investors raised concerns about rising borrowing cost, impacting cash flow operations of the AI hyperscalers and the AI ecosystem companies.

In Europe, benchmarks dropped more than 1%, including 1.5% in Paris, following violent protests over the weekend that could force governments to increase their spending and put even more pressure on bond markets. Yields cranked higher for European bonds despite drops for oil prices, news agency _AP _reported.

CoreWeave, which dropped 25% last week on concerns over its creditworthiness, was up over 2% at $62 per share.

SpceX shares surged 2% to $148.99 per share after Elon Musk said that starting next year, he will give one of his SpaceX shares to every kid in America.

"Next year, I will give one of my SpaceX shares to every kid in America. This will be the first of many," Musk said on X.

Meanwhile, falling crude oil in global markets also supported the up move in Monday’s session.

Brent crude futures for delivery in December dropped 1.5% to $108 per barrel after US President Donald Trump waived sanctions and tariffs on Russia that may lead to more Russian fuel exports, analysts said.

The move came after Trump struck a deal with Russian President Vladimir Putin to export diesel to ‌the ⁠United States. Ukrainian President Volodymyr Zelenskiy said these US actions will hurt Ukraine, the report added.

Sandisk, Datadog Inc, Teradyne Inc, Marvell Technology and Western Digital were top gainers in the Nasdaq.

On the flipside, Axon Enterprises, Exelon, Intuit, Paccar and Meta Platforms were top losers in the Nasdaq index.