Wall Street rallies on Trump China comments; Broadcom surges

Wall Street’s main indexes rallied on Monday, led by gains in Broadcom and other chipmakers, after President Donald Trump struck a conciliatory tone that eased worries about renewed U.S.-China trade tensions.

Lifting sentiment, U.S. Treasury Secretary Scott Bessent said in an interview with Fox Business Network that Trump was on track to meet his Chinese counterpart in South Korea as the two sides work on de-escalating trade frictions that grew late last week.

AI-related tech stocks were the biggest winners in Monday’s rebound, with Broadcom (AVGO.O), surging 10% after partnering with OpenAI to produce the startup’s first in-house artificial intelligence processors.

The Nasdaq was on track for its biggest one-day gain since May 27.

“AI continues to be the momentum driver, and it’s not surprising investors have purchased the dip,” said Sam Stovall, Chief Investment Strategist at CFRA Research, adding that investors should remain cautious as long as Trump’s dispute with China remains unresolved.

Wall Street tumbled on Friday, with the S&P 500 and Nasdaq posting their in months.

The latest rupture followed China’s announcement on Thursday that it would its rare earths export controls. In retaliation, Trump on Friday said he would apply an additional 100% tariff on imports from China and impose export controls on all critical U.S.-made software from November 1.

However, over the weekend, Trump said “it will all be fine” and that the U.S. did not want to “hurt” China. China on Sunday blamed the U.S. for the escalation but did not roll out further countermeasures.

Other AI-related chipmakers also gained, with Nvidia adding 2.7% and Micron Technology rallying 5.8%. The PHLX chip index (.SOX), jumped nearly 5%.

JPMorgan Chase (JPM.N), Goldman Sachs (GS.N), Citigroup (C.N), and Wells Fargo (WFC.N) are set to release quarterly results on Tuesday, kicking off an earnings season that investors will watch closely for signs of how tariffs are impacting Wall Street’s largest companies.

They’re pricing in a 98% probability almost to see a 25 basis point rate cut.

Earnings reports will provide fresh clues on the economy at a time when major official data releases remain delayed due to an ongoing government shutdown. Analysts on average expect S&P 500 companies’ third-quarter earnings to grow 8.8% from a year ago, according to LSEG data.

The S&P 500 was up 1.59% at 6,656.68 points.

The Nasdaq gained 2.17% to 22,686.79 points, while the Dow Jones Industrial Average was up 1.31% at 46,075.88 points.

Ten of the 11 S&P 500 sector indexes rose, led by information technology (.SPLRCT), up 2.57%, followed by a 1.97% gain in consumer discretionary (.SPLRCD).

In the Middle East, Hamas freed the last living Israeli hostages from Gaza and Israel sent home Palestinian detainees as part of a ceasefire deal pushed by Trump.

Oracle (ORCL.N), gained 5.6% after at least two brokerages raised their price target on the AI cloud firm.