Nasdaq Index and S&P500: Tech Stocks Rally Today as Megacap Earnings Loom

S&P 500 and Nasdaq Hit Two-Week Highs Ahead of Earnings Deluge

The benchmark S&P 500 and tech-heavy Nasdaq Composite moved to their highest level since January 15 at the mid-session on Monday as sentiment remained upbeat in the face of geopolitical and domestic events. The price action suggests a relative calm in the markets as investors brace for a slew of major earnings reports and the first Federal Reserve policy decision of 2026.

At 18:37 GMT, the Dow is up 330.11 points or 0.67% at 49428.82, the S&P 500 Index is trading 6961.76, up 46.15 or +0.67% and the Nasdaq Composite is trading 23667.638, up 166.394 or +0.71%.

Sector Performance: Communications and Tech Lead Gains

Most of the major sectors are showing green at the midsession, led by Communications Services, up a whopping 1.77%. Technology is a distant second at 1.01%. Materials are trading 0.77% higher, helped by a surge in gold to a record high above $5100. Consumer Staples, Energy and Consumer Discretionary are all lower.

From my viewpoint, it appears to be a stock picker’s day with investors perhaps positioning ahead of the megacap earnings reports on Wednesday. Doing the heavy lifting for the S&P 500 Index are Apple and Meta, both up over 2% each, Alphabet, Broadcom, and Microsoft rose over 1.5% each.

Megacap Earnings: AI Impact in Focus

The megacaps scheduled to report mid-week are Apple, Meta, Microsoft and Tesla. Investors want to see if the euphoria in this AI-driven rally actually had an impact on earnings results.

“This week’s lineup of megacap earnings should help shape sentiment around the AI trade and the still-struggling tech sector, but Wednesday’s Fed announcement will likely keep politics in the headlines,” said Chris Larkin at E*Trade from Morgan Stanley.

Of the 64 companies in the S&P 500 that have reported earnings as of Friday, 79.7% beat analyst expectations, according to LSEG data via Reuters.

Market Movers: Winners and Losers

Today’s notable losers included Intel, which continued its slide with a 5% loss today on top of Friday’s 17% decline. Meanwhile, airline stocks are being impacted by the weather, which has caused mass disruptions. United Airlines is down 1.2%, while JetBlue lost 2.8%.

One of the biggest winners on the day is USA Rare Earth, which jumped 11% after reports the U.S. administration was taking a 10% stake in the miner as part of a $1.6 billion debt-and-equity investment package, Reuters reported.

Fed Decision and Earnings Dominate Week Ahead

Looking ahead to Wednesday, in addition to the major earnings reports, the Fed will release its latest rate decision. Investors expect the central bank to keep rates unchanged. The market will be most interested in what Chairman Powell has to say about the timing of the first rate cut in 2026.

Technical Analysis: Nasdaq Eyes All-Time High

Technically, the Nasdaq Composite (IXIC) is in a strong position as we head into the close. Since last week’s short-sell-off, the index has recaptured its 50-day moving average at 23273.00, launching a three-day rally that is nearing the January 13 top at 23813.30. It’s also closing in on a major trendline near the same level.

Overcoming the trendline and the top could create the momentum needed to challenge the all-time high at 24019.99. Unless there is unexpected news, we’re looking for a firm trade into the close.

More Information in our Economic Calendar.