Nvidia and Intel deal supports tech sector: three major US indices hit new records

Three major U.S. stock indices hit records in trading on September 18, a day after the U.S. Federal Reserve cut interest rates for the first time this year. Investors were buoyed on Thursday by a deal between Nvidia and Intel, under the terms of which the former will invest $5 billion in the latter.

- The S&P 500 was up 0.9 percent to 6656.8 points at the moment.

- The Nasdaq Composite added 1.3 percent to 22,540.93 points.

- The Dow Jones blue-chip index rose 0.7% to 46,018.32 points.

- The Russell 2000 index of small-capitalization companies climbed the most, up more than 2%. The index continued to rise after rising above its record closing level on Wednesday for the first time since November 2021.

- In contrast, the VIX volatility index, also known as the Wall Street Fear Index, was down nearly 9%. The yield on 10-year U.S. government bonds rose to 4.1%, while the dollar index DXY strengthened 0.53% to 97.38. Gold, on the other hand, fell 1.2% to $3673 an ounce.

- Intel shares were up nearly 30% in trading on September 18, while Nvidia securities were up 3.7%.

- Against that backdrop, the iShares Semiconductor ETF (SOXX), an exchange-traded fund that tracks the performance of the world's largest semiconductor makers, added 4% at one point, breaking a record and posting its biggest daily gain since late June, MarketWatch cited Dow Jones Market Data.

- Shares of several other large technology companies that typically perform better amid rate cuts also rose, with Palantir adding 5% and Micron adding 6%.

The U.S. Federal Reserve at the end of the meeting on September 16-17 reduced the interest rate by a quarter of a point - to 4-4.25%. This was the first easing of monetary policy in the US in 2025. The first reaction of investors was uncertain: S&P 500 and Nasdaq declined at the end of trading on September 17: investors were concerned about the words of Fed chief Jerome Powell that the rate cut should be considered as "risk management", while the market expects a full-fledged cycle of cuts.

On Thursday, September 18, leading artificial intelligence processor maker Nvidia said it will invest $5 billion in U.S. chipmaker Intel and become one of its largest shareholders, gaining about 4 percent. The makers agreed to jointly develop chips for PCs and data centers. Nvidia's backing opens up new prospects for Intel after years of failed attempts at a transformation, Reuters noted

This article was AI-translated and verified by a human editor