U.S. stocks hit new highs, Philadelphia Semiconductor Index ends 18-day rally

On Monday, the US-Iran stalemate remained unresolved, with the overall market sentiment being cautious. The three major US stock indexes initially fell together, but were supported by some tech stocks like Nvidia, which helped the S&P and Nasdaq turn positive during the session and continue to set new record highs.

The S&P 500 index rose slightly by 0.12%, continuing its monthly rally and有望 creating the best single-month performance since 2020. The Nasdaq and Dow lagged behind, and the semiconductor sector saw its first monthly decline.

The Philadelphia Semiconductor Index fell by about 1% on Monday, ending an 18-day consecutive rise and setting the longest record for the index. The monthly gain reached 39%, deviating from the 200-day moving average, which is close to the level seen during the internet bubble in 2000.

Goldman Sachs' hedge fund director warned: "I have never seen this since the internet bubble, and I won't chase it."

(Daily performance of US benchmark stock indexes)

Reports said that OpenAI is working with Qualcomm to develop smartphone chips. Nvidia rose by 4%, setting another historical record high, while memory chip stocks also rose sharply, with SanDisk rising by more than 8% and Micron by 5.6%. The chip index, however, fell by 1%, ending its record-breaking 18-day consecutive rise, and AMD fell by nearly 4%.

Among the 11 major sectors of the S&P 500 index, the communication services sector showed the largest rise, while the consumer staples sector showed the largest decline. The performance of the seven tech giants today outperformed the S&P 493 index.

(The seven tech giants outperform the market)

Options data showed that a large number of zero-day put options were sold at the end of the day, which lowered the VIX index, but analysts pointed out that this move was in stark contrast to the significant event risks coming up this week.

(Daily comparison of E-mini S&P 500 index futures and VIX "Fear Index")

On Wednesday after the US stock market closes, Alphabet, Microsoft, Amazon, and Meta will release their first-quarter earnings reports simultaneously, followed by Apple on Thursday. These five companies have a combined market value of nearly $16 trillion, accounting for about 44% of the total market value of the S&P 500, and their earnings reports will largely determine whether the market rally in April can obtain fundamental support.

Senior strategist Louis Navellier said:

Considering the AI-driven market trend, the outlook and capital expenditure plans of the seven giants will be key to maintaining the market's upward momentum.

Bloomberg macro strategist Kristine Aquino pointed out that the core issue facing investors is whether the huge AI investments of tech giants have yielded quantifiable returns. This key variable seems quite fragile as a support to the stock market rally so far this year.

Goldman Sachs strategist Nelson Armbrust pointed out that the previously high-intensity macro short hedge positions have been significantly unwound, and the leverage level has contracted.